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4 August, 10:01

Receivables might be sold to

finance companies at an amount greater than cash realizable value.

lengthen the cash-to-cash operating cycle.

take advantage of deep discounts on the cash realizable value of receivables.

generate cash quickly.

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Answers (1)
  1. 4 August, 10:56
    0
    generate cash quickly.

    Explanation:

    The selling of receivables for the collection of cash is known as factoring. It is done by engaging a third party (usually finance companies) to purchase the debt owed by another party for cash such that when the debt are settled, the settlement goes to the third party.

    Receivables might be sold to collect cash (thus shortening the cash-to-cash operating cycle). This is usually done at an amount lower than the receivable itself mostly with the motive of improving cash flows for the selling organization.

    Considering all the option given the right option is Receivables might be sold to.
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