Why is it a good business practice to keep accounts receivable as low as possible?

Question

Quizplus · Accepted Answer

Keeping accounts receivable low allows the business to use the money to earn interest or pay debts, which can ultimately lead to increased profitability. It also reduces the risk of bad debt and improves cash flow, providing greater stability for the business. Complying with government regulations and providing better service to patients may also be important, but they are not directly related to the financial benefits of keeping accounts receivable low. Decreasing paperwork may be a benefit, but it is not as significant as the financial benefits.

Why Is It a Good Business Practice to Keep Accounts