A company sells its accounts receivable to an intermediary.The intermediary collects the receivables from the customer.This is an example of ________.
A) an unsecured loan
B) factoring
C) trade credit
D) a secured loan
E) a commercial paper

Question

Quizplus · Accepted Answer

A)Factoring refers to obtaining funding by selling accounts receivable. Factoring is an alternative to short-term debt financing.
B)Factoring refers to obtaining funding by selling accounts receivable. Factoring is an alternative to short-term debt financing.
C)Factoring refers to obtaining funding by selling accounts receivable. Factoring is an alternative to short-term debt financing.
D)Factoring refers to obtaining funding by selling accounts receivable. Factoring is an alternative to short-term debt financing.
E)Factoring refers to obtaining funding by selling accounts receivable. Factoring is an alternative to short-term debt financing.

A Company Sells Its Accounts Receivable to an Intermediary