In ________, a company has an ongoing relationship with a bank that routinely buys its short-term accounts receivable at a discount.

Question

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Factoring involves a financial arrangement where a company sells its accounts receivable to a third party (the factor) at a discount, in exchange for immediate cash. This provides the company with working capital and transfers the risk of non-payment by the debtor to the factor.

In ________, a Company Has an Ongoing Relationship with a Bank