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A firm

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Question

A firm sells its $1,100,000 receivables to a factor for $1,078,000. The average collection period is 1 month.

What is the effective annual rate on this arrangement? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

 
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The more liberal the terms of the collection policy

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Question

The more liberal the terms of the collection policy, the lower the potential for bad debts and unprofitable

sales.TrueFalse

 
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Money market securities

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Question

Money market securities usually have a maturity of:more than 1 year. less than 1 year. 1 to 3 years. less

than 91 days

 
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liquid assets

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Question

The safety margin kept by the bank on loan against liquid assets is called:a haircut. a line of credit.

factoring. field warehousing.

 
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