Which of the following does not represent an acceptable method of transferring receivables to increase cash flow?
A) With recourse
B) Without recourse
C) Factoring
D) Tax deferred Method

Question

Quizplus · Accepted Answer

Tax deferred method does not represent a method of transferring receivables to increase cash flow. It is a method of deferring tax liability by postponing the recognition of income from the sale of receivables. A, B, and C represent acceptable methods of transferring receivables to increase cash flow. With recourse allows the transferor to recover the receivables in case of default, without recourse transfers the risk of default to the transferee, and factoring involves selling receivables to a third party at a discount.

Which of the Following Does Not Represent an Acceptable Method