Which of the following is not true regarding factoring accounts receivable?

Question

Quizplus · Accepted Answer

Factoring accounts receivable involves selling the receivables to a factor, which then assumes the risk and responsibility for collecting them. This process removes the receivables from the company's balance sheet (A), is indeed a sale of accounts receivable (B), and typically the factor makes the credit decisions regarding the customers (C). There are no audit fees for periodic reviews specifically associated with factoring accounts receivable (D); instead, the costs usually involve a discount fee or charge by the factor for taking on the receivables.

Which of the Following Is Not True Regarding Factoring Accounts