Firms actually benefit from late payments, because they reduce the amount of accounts payable.

Question

Quizplus · Accepted Answer

Late payments can have a negative impact on firms, leading to cash flow problems and potential damage to supplier relationships. While delayed payments may temporarily reduce accounts payable, it can also harm a company's reputation and lead to increased creditor scrutiny. Ultimately, consistent late payments can hurt a company's financial health and growth potential.

Firms Actually Benefit from Late Payments, Because They Reduce the Amount