Selling the small company's accounts receivable outright to another business is called:
A) collateral.
B) factoring.
C) trade credit.
D) a line of credit.

Question

Quizplus · Accepted Answer

Selling accounts receivable outright to another business is called factoring. Collateral refers to an asset that is pledged as security for a loan, trade credit is the credit extended by one business to another, and a line of credit is a flexible borrowing arrangement with a lender.

Selling the Small Company's Accounts Receivable Outright to Another Business