The three components of credit policy are:
A)collection policy,credit analysis,and interest rate determination.
B)collection policy,credit analysis,and terms of the sale.
C)collection policy,interest rate determination,and repayment analysis.
D)credit analysis,repayment analysis,and terms of the sale.
E)interest rate determination,repayment analysis,and terms of sale.

Question

Quizplus · Accepted Answer

The three components of credit policy are collection policy (guidelines for collecting outstanding payments from customers), credit analysis (process of evaluating a potential borrower's creditworthiness), and terms of the sale (conditions under which credit is granted, such as payment deadlines and interest rates). Interest rate determination and repayment analysis are important factors in credit policy, but they are not considered independent components.

The Three Components of Credit Policy Are