The purpose of credit analysis is to:
A) reconcile the accounts receivable balance.
B) modify the terms of trade credit.
C) organize the right side of the balance sheet.
D) decide whether or not to grant credit to a customer.

Question

Quizplus · Accepted Answer

The purpose of credit analysis is to evaluate the creditworthiness of potential or existing customers and determine whether or not to grant credit. This involves assessing their financial stability, credit history, and ability to repay debts. Choices A, B, and C involve other financial tasks, but they do not specifically relate to the evaluation of creditworthiness.

The Purpose of Credit Analysis Is To