Factoring involves selling accounts receivable to a financial institution at a discount to obtain short-term funds.

Name: Factoring involves selling accounts receivable to a financial institution at a discount to obtain short-term funds.
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Question

Quizplus · Accepted Answer

This is a correct statement. Factoring is a type of financing where businesses sell their accounts receivable to a financial institution, such as a bank or a factoring company, at a discount in exchange for immediate cash.

Factoring Involves Selling Accounts Receivable to a Financial Institution at a Discount