Credit investigation, Managerial Accounting

Assignment Help:

Once the credit information is accumulated the subsequent step is to analyze the gathered information and isolate those matters that may need further investigation. The factors which affect the extent and nature of credit investigation are given as:

  • Category of customer, whether new or existing
  • The customer's background, business line and the related trade risks
  • The nature of products-perishable or seasonal
  • The size of the customer's demand and expected additional volume of business with him or her
  • Company's credit practices and policies
  • Capacity: Capacity refers to the capability of the buyer to pay the due on time and is generally judged through the past turnover and the repayment behaviour
  • Character: Character considers as the willingness of the buyer to pay. The character of the buyer is usually judged by his or her past record of payments and default history if any.
  • Collateral: it implies that the security against the credit granted to customers. A buyer willing to furnish sufficient collateral is judged as more creditworthy as compared to buyers who are not capable to furnish any collateral.
  • Conditions: this is here referring to the sensitivity of the buyer to common economic environment.

Related Discussions:- Credit investigation

Research and writing assignment, Write a response to your boss, the control...

Write a response to your boss, the controller. The response should be 2-5 pages in length (double-space). Your response to the controller should include, but not be limited to, t

Explain the mark up pricing, Full cost or mark up pricing or cost plus pric...

Full cost or mark up pricing or cost plus pricing method: In this method the marketer estimates the total cost of producing or manufacturing the product and then adds it a mar

Process of pricing in maturity period, Q.Process of Pricing in maturity per...

Q.Process of Pricing in maturity period? Maturing periods is the third stage in the life cycle of a product. If is a stage between growth period and decline period of sales. So

The break even point in dollorsales for rice company, the break even point ...

the break even point in dollorsales for rice company is48,000 and the company's contribution margin ratio is 40 percent. If Rice Company desires a profit of $84,000, how much wou

Advantages of value added statements, Advantages of Value Added Statements ...

Advantages of Value Added Statements 1) Managers might be in a better position to control their organizations own inputs than the cost and usage efficiency of purchased materia

What procedure are followed in kaizen costing, What Procedure are followed ...

What Procedure are followed in kaizen costing In brief kaizen costing involves setting a new cost reduction target every month. The difference between the target profits and th

Explain short term budgets, Explain Short term budgets Short term budge...

Explain Short term budgets Short term budgets: these budgets are generally for one or two years and are in the form of monetary terms. The consumer's good industries like su

Adjacent extreme points, Adjacent extreme points differ in only one variabl...

Adjacent extreme points differ in only one variable The first observation indicates that we can identify the extreme points of the solution space algebraically by setting zero as

Illustrate traditional budgeting vs zero base budgeting, Traditional budget...

Traditional budgeting vs. zero base budgeting 1) Traditional budgeting is accounting oriented. Main stress happens to be on previous level of expenditure. Zero base budgeting m

Standard error of the slope, Std error of the slope (Sb) Correlation co...

Std error of the slope (Sb) Correlation coefficient measures the degree of association between two variables such as the cost and the activity level. The standard error of ‘

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd