Asked by Writes Wanderlust on Jul 07, 2024
Verified
Cash is increased when a firm grants credit to a customer
Grants Credit
The offering of deferred payment terms or a line of credit to a buyer for the purchase of goods or services.
Cash Increase
An upward movement in a company's cash balance, indicating improved liquidity or additional inflow of money.
- Understand the impact of credit management on a company's cash flow.
Verified Answer
KD
Kevin DurantJul 12, 2024
Final Answer :
False
Explanation :
Granting credit to a customer means the customer buys now and pays later, so cash does not increase until the customer actually pays.
Learning Objectives
- Understand the impact of credit management on a company's cash flow.