Asked by Nikki Tajdar on Jul 05, 2024
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Preauthorized payments help reduce collection float.
Preauthorized Payments
Automated payments set up to charge a bank account or credit card for recurring bills or subscriptions on a pre-set schedule.
Collection Float
The time period between when a check is deposited in a bank and when the funds are available in the account, impacting cash flow management.
- Understand the role and mechanism of preauthorized payments and their impact on collection time.
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Learning Objectives
- Understand the role and mechanism of preauthorized payments and their impact on collection time.
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