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

Question

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Monitoring accounts receivable to analyze the effectiveness of a credit policy is crucial after establishing the policy. This helps in understanding if the policy is working as intended or if adjustments are needed.

What Should a Firm Do After Establishing a Credit Policy