When the accounts receivable of a firm have been factored,bad debt losses remain the responsibility of the borrowing firm and must be made good.

Question

Quizplus · Accepted Answer

When accounts receivable are factored, the responsibility for bad debt losses typically transfers to the factor (the party purchasing the receivables), unless the arrangement specifies recourse factoring, where the selling firm remains liable for bad debts.

When the Accounts Receivable of a Firm Have Been Factored,bad