How does accounts receivable factoring work, Financial Management

Assignment Help:

How does accounts receivable factoring work? What are the benefits to the two parties involved? What are the risks?

Factoring is when one firm trade accounts receivable (AR) to another. The purchasing firm is called as a factor. The factor makes a profit by buying the AR at a discount. Its risk is that few of the AR may default. The selling firm obtains the cash it needs.

Related Discussions:- How does accounts receivable factoring work

Pension fund system - uk, The UK Pension Fund System The UK Pension sys...

The UK Pension Fund System The UK Pension system is a three pillar pension system. A flat-rate first-tier pension is provided by the state and is known as the Basic State Pensi

Periodic system, limitations of using a periodic inventory system

limitations of using a periodic inventory system

Determine have mergers affected competition, Have mergers affected competit...

Have mergers affected competition? A: Federal Reserve data depict that measured on the local level, where competition occurs; markets have in fact experienced more banking comp

Define multinational corporations (mncs), What are multinational corporatio...

What are multinational corporations (MNCs) and what economic roles do they play? A multinational corporation (MNC) can be described as a business firm incorporated in one count

Aggressive approach of financial management, Q. Aggressive Approach of fina...

Q. Aggressive Approach of financial management? A -firm may be aggressive in financing its assets. An aggressive policy is said to be followed by the firm when it uses short-te

Variable costs, V ariable Costs It is an expense that varies direct...

V ariable Costs It is an expense that varies directly with changes in business activities for example the cost of raw materials rise and decreases as the volume of producti

Surplus economic unit deal with a deficit economic unit, What can a financi...

What can a financial institution often do for a surplus economic unit that it would have difficulty doing for itself if the surplus economic unit (SEU) were to deal directly with a

Equity share valuation.., Mount Hutt Ltd. just paid dividend of $2.20 per s...

Mount Hutt Ltd. just paid dividend of $2.20 per share. The dividends are expected to grow at a constant rate of 4% per year, indefinitely. If investors require an 11% return on Mou

State the term nature of financial instruments, State the term nature of fi...

State the term nature of financial instruments. Nature of financial instruments (securities): Financial instruments (termed as securities) can be classifies in two broad

Future value of an annuity, Will you please give the defination of "Future ...

Will you please give the defination of "Future Value Of An Annuity"?

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages