Aardvark is a small pest-control business that has 30 employees. The company started business within the past year, and needs to make a decision on how best to make sure its finances are managed well as the company continues to grow its customer base and its business.
Aardvark needs some quickly obtainable funds to pay some overdue bills. It is considering using factoring-obtaining cash in exchange for outstanding accounts receivable funds. Which of the following, if true, would strengthen the case for using factoring?
Factoring can be a costly way to obtain ready cash.
Aardvark would not have to liquidate any of its core assets to stay in business.
Customers may be annoyed if they think their account has been turned over to a collection agency.
Additional accounting practices are necessary to keep track of factored customer accounts.
Factoring companies usually won't take on receivables more than 90 days old.

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The Answer of Aardvark is a small pest-control business that has 30 employees. The company started business within the past year, and needs to make a decision on how best to make sure its finances are managed well as the company continues to grow its customer base and its business.
Aardvark needs some quickly obtainable funds to pay some overdue bills. It is considering using factoring-obtaining cash in exchange for outstanding accounts receivable funds. Which of the following, if true, would strengthen the case for using factoring?
Factoring can be a costly way to obtain ready cash.
Aardvark would not have to liquidate any of its core assets to stay in business.
Customers may be annoyed if they think their account has been turned over to a collection agency.
Additional accounting practices are necessary to keep track of factored customer accounts.
Factoring companies usually won't take on receivables more than 90 days old.

Aardvark Is a Small Pest-Control Business That Has 30 Employees