A firm's practice of ignoring a payment due period and paying later is called:
A)shirking.
B)missing accounts payable.
C)default.
D)a credit event.
E)stretching the accounts payable.

Question

Quizplus · Accepted Answer

Stretching the accounts payable refers to intentionally delaying payment to suppliers beyond the agreed-upon due date in order to improve cash flow. It is a common practice in business, but can have negative consequences if it becomes a pattern or if suppliers decide to cut off the firm's credit.

A Firm's Practice of Ignoring a Payment Due Period and Paying