A negative cash discount is used by a seller to:
A)reduce prices on a one-time-only basis.
B)improve its liquidity position and cut collection expenses.
C)return the costs incurred by channel members in performing marketing functions.
D)reduce prices in an attempt to integrate promotional strategies within distribution channels.

Question

Quizplus · Accepted Answer

A negative cash discount is a discount given to customers who pay their bills within a specified period of time. This is an incentive for customers to pay their bills on time and helps the seller improve its liquidity position by reducing the time it takes to collect payments and cutting collection expenses.

A Negative Cash Discount Is Used by a Seller To