Explore BrainMass

Explore BrainMass

    How is credit policy set in an organization?

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    How is credit policy set in an organization? How would you set the credit policy?

    Why is monitoring accounts receivable important? How would you monitor the accounts receivable?

    © BrainMass Inc. brainmass.com June 3, 2020, 8:06 pm ad1c9bdddf
    https://brainmass.com/business/accounts-receivable-management/credit-policy-set-organization-123603

    Solution Preview

    How is credit policy set in an organization? How would you set the credit policy? Why is monitoring accounts receivable important? How would you monitor the accounts receivable?

    These are the questions involving the issue of credit management. This is decision relating to terms of sale. Here one has to establish sensible credit limits. The job of the credit manager is not to minimize the number of bad debts but to maximize the profit. This means that one should increase the customer's credit limit as long as the probability of payment times the expected profit is greater than the probability of default times the cost of goods. ...

    Solution Summary

    The expert determines how a credit policy set in an organization. Why monitoring accounts receivable is important is determined.

    $2.19

    ADVERTISEMENT