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Credit Sales & Collection Policies

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Please help with the following problem involving financial accounting and bookkeeping.

What are your thoughts on the issues and procedures that a business must consider regarding credit sales and collections. Summarize your recommendations in memo form.

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Solution Summary

The following posting helps with a financial accounting and bookkeeping problem. It discusses thoughts on the issues and procedures that a business must consider regarding credit sales and collections.

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To: Mike Anderson, Sales Manager, All Sales Persons.
FROM: Jennifer Smith, Finance Assistant,
DATE: October 7, 2xxx
SUBJECT: Credit Sales & Collections

We need to reiterate the credit policy of our company. This memo will set down the procedures that need to be followed for sanctioning credit sales. Further, we need to fix the responsibility for collections regarding credit sales. We shall discuss issues relating to credit sales and collection that directly affect the financial health of the company.

During the year ended 31st December we had an unprecedented 12% doubtful/bad debt that was up from ...

Solution provided by:
Hatim Baxamusa, MBA
Education
  • BSc , University of Calcutta
  • MBA, Eastern Institute for Integrated Learning in Management
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