________ is a financial transaction whereby a business sells its accounts receivable to a third party at a discount in exchange for cash.
A) Factoring
B) Vendor credit
C) Peer-to-peer lending
D) Crowdfunding
E) Leasing

Question

Quizplus · Accepted Answer

Factoring is the financial transaction where a business sells its accounts receivable to a third party at a discount in exchange for cash. In this way, companies can convert their account receivables into cash without waiting for the payment from their customers. This process of factoring helps businesses to maintain a steady cash flow and minimize the risk of non-payment from their customers. The other options, such as vendor credit, peer-to-peer lending, crowdfunding, and leasing, do not involve the sale of accounts receivables.

________ Is a Financial Transaction Whereby a Business Sells Its