The company offering a discount on accounts payable is trying to ________ and the firm that pays on time rather than take a discount is attempting to ________.
A) Speed up cash outflow; slow down cash inflow
B) Speed up cash inflow; slow down cash inflow
C) Speed up cash inflow; slow down cash outflow
D) Speed up cash outflow; slow down cash outflow

Question

Quizplus · Accepted Answer

The company offering a discount on accounts payable is trying to speed up cash inflow by encouraging firms to pay their bills early in exchange for a lower cost. The firm that pays on time rather than taking a discount is attempting to slow down cash outflow by paying their bills at the normal rate and not allowing the discount to affect their payment schedule.

The Company Offering a Discount on Accounts Payable Is Trying