Which one of the following statements is correct?
A) Firms may opt to refuse additional credit to a delinquent customer.
B) Seasonal sales have little, if any, impact on aging schedule percentages.
C) Normally, firms call their delinquent customers prior to sending them a past due letter.
D) If a firm wishes to sell a delinquent receivable, it must do so prior to the customer filing for bankruptcy.
E) Expected decreases in the average collection period are a cause of concern.

Question

Quizplus · Accepted Answer

Firms may refuse additional credit to a delinquent customer as a way to mitigate their credit risk. This can also serve as a warning to the customer that future delinquent behavior will not be tolerated.

Which One of the Following Statements Is Correct