Poor controls over credit limit approval or in changing the credit limit in the master file may result in
A) confused and frustrated customers.
B) incomplete sales records.
C) financial statement errors for sales and AR accounts.
D) excessive bad debts and uncollectible account receivables.

Question

Quizplus · Accepted Answer

Poor controls over credit limit approval or in changing the credit limit in the master file may result in excessive bad debts and uncollectible account receivables. If credit limits are not properly monitored and enforced, customers may end up with large balances that they cannot pay, which could ultimately lead to defaults and write-offs. This can also impact the company's financial health and profitability.

Poor Controls Over Credit Limit Approval or in Changing the Credit