Which one of the following is least likely to be correct about the factoring of receivables?
A) The selling firm bears the risk of default.
B) The higher the perceived quality of the receivables, the lower the discount rate.
C) The discount is paid by the selling firm in the form of a reduced sales price.
D) Factoring may be the cheapest method of avoiding a cash flow problem.
Correct Answer:
Verified
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