What should a firm do after establishing a credit policy?
A)Decide what should be done for those customers who do not pay their accounts on time.
B)Monitor its accounts receivable to analyze whether its credit policy is effective.
C)Decide on the length of the period before payment must be made.
D)Determine what percent of monthly sales are collected in the month after that sale.
E)Encourage as many customers as possible to use credit.

Question

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After establishing a credit policy, a firm should monitor its accounts receivable to analyze whether its credit policy is effective. This helps in assessing the impact of the policy on cash flow and identifying areas for improvement.

What Should a Firm Do After Establishing a Credit Policy