Asked by Vikki Yager on Jul 21, 2024
Verified
Selling receivables is called
A) factoring
B) sales revenue
C) a factor
D) sold receivables
Factoring
A financial transaction where a business sells its accounts receivable to a third party at a discount, in exchange for immediate cash.
- Recognize the differentiation among receivable categories and their classification in fiscal statements.
Verified Answer
ID
Ivory DaviesJul 22, 2024
Final Answer :
A
Explanation :
Factoring is the financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. This is done to obtain immediate cash flow.
Learning Objectives
- Recognize the differentiation among receivable categories and their classification in fiscal statements.
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