The major risk associated with receivables is related to which of the following?
A)They may be sold to a bank with recourse.
B)They may be recorded as long-term when in fact they will be realized in the current period.
C)They will not be realized for the entire amount due.
D)They are pledged as collateral as disclosed in the footnotes to financial statements.

Question

Quizplus · Accepted Answer

The major risk associated with receivables is that they will not be realized for the entire amount due, which may result in bad debt expenses and write-offs. Options A, B, and D are not necessarily major risks associated with receivables.

The Major Risk Associated with Receivables Is Related to Which