Kramerica Industries' receivables collection period is growing significantly faster than its competitors. This may be a red flag of an impending cash shortage.

Question

Quizplus · Accepted Answer

A longer receivables collection period indicates that Kramerica Industries is taking longer to collect payments from customers, which could ultimately lead to a cash shortage if they are unable to meet their financial obligations without the expected influx of cash from receivables. This is a red flag that should be closely monitored by the company's management and investors.

Kramerica Industries' Receivables Collection Period Is Growing Significantly Faster Than