By factoring its receivables, a firm converts them into cash immediately rather than having to wait for customer payment.

Name: By factoring its receivables, a firm converts them into cash immediately rather than having to wait for customer payment.
Brand: Quizplus
Rating: 4.9 (41 reviews)

Question

Quizplus · Accepted Answer

Factoring receivables involves selling them to a third-party company at a discount, which generates quick cash for the firm. This eliminates the need to wait for customer payment and improves the firm's cash flow.

By Factoring Its Receivables, a Firm Converts Them into Cash