moodle·adelphi·edu 3sk.tv/s/vid/s/19434 My eCampus Adelphi Univers.. BUS 162-004
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moodle·adelphi·edu 3sk.tv/s/vid/s/19434 My eCampus Adelphi Univers.. BUS 162-004 Your Dropbox Upgrade now fo space and shari d. in one lump sum or with many payments spread out over a period of time. e, in payments that start after the maturity date and continue for several years. ion 3 When Dave's Appliances struggles financially, Dave decides to sell his accounts receivable to a financial company, known as a factor, which pays him $60,000 for receivables with a total face value of $100,000. Which of the following best describes how the financial company can make a profit off these accounts receivable? t answered out of g question Select one: a. The factor only profits if it can secure more sales from these b. The factor only profits if the customers don't know that a O c. The factor profits if it can produce the same products the customers factor has bought their receivables. company did at a lower cost. d. The factor profits if it can collect more than what it paid for the accounts. e. The factor profits only if new accounts receivable are acquired on 4 tanswered dout of A finance company that buys other companies' accounts responsibility for collecting the debt is known as a Select one: receivable for less than they are worth and assumes the aquestiona. lockbox.Explanation / Answer
The correct answer to this question is "D".
As Factor has bought these accounts receivables for only $60,000 and the real value of these accounts receivables are $100,000. Factor has purchased them at a price less than its face value. The accounts receivables can fetch Factor a total of 100,000. So to earn profit Factor can collect more than what it paid for the accounts, if it is anything above 60,000 factor will be earning profit.
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