Slow-paying credit accounts
A) almost always help to build goodwill with customers.
B) yield advantages from carry-over effects.
C) tie up the seller's working capital.
D) are rarely a problem for small businesses.

Question

Quizplus · Accepted Answer

Slow-paying credit accounts tie up the seller's working capital, which can cause cash flow problems for the business. This can be especially problematic for small businesses that have limited resources. A and B are incorrect because slow-paying credit accounts do not necessarily build goodwill or yield advantages, as they can strain the seller-customer relationship and impact the seller's financial health. D is also incorrect as slow-paying credit accounts can be a problem for businesses of all sizes.

Slow-Paying Credit Accounts