An increase in collection efforts will result in__________ in sales volume,__________ in the investment in accounts receivable,__________ in bad debt expenses, and__________ in collection expenditures.
A) an increase; a decrease; a decrease; an increase
B) a decrease; a decrease; a decrease; an increase
C) an increase; a decrease; an increase; an increase
D) an increase; a decrease; an increase; a decrease

Question

Quizplus · Accepted Answer

An increase in collection efforts typically leads to a decrease in sales volume as stricter credit terms may deter some customers. It also results in a decrease in the investment in accounts receivable and bad debt expenses due to improved collections. However, collection expenditures increase due to the additional resources required for the enhanced collection efforts.

An Increase in Collection Efforts Will Result In__________ in Sales