Terms of payment, Managerial Accounting

Assignment Help:

Terms of payment vary broadly in practice. At one conclusion, if the seller has financial resources, she or he may extend liberal credit to the buyers, conversely the buyer pays in advance and finances the whole trade cycle. The terms of credit differ for various industries and are dictated through prevailing trade practices. Generally, businesses operating in monopoly environment will require advance or cash payment while business operating in a competitive environment will expand credit to the buyers. The main terms of payment are as listed as given below:

Cash Terms

While goods are sold on cash terms, the sales consideration or say payment is received either before goods are sold as advance payment or while the goods are delivered as cash on delivery Cash term usually exist under the subsequent conditions:

(a) While goods are made to order

(b) While the buyer is perceived to be less credit worthy

(c) The seller is in strong bargaining position.


Related Discussions:- Terms of payment

The simplex method, The Simplex Method In the graphical solution the op...

The Simplex Method In the graphical solution the optimum solution is always associated with a corner (or extreme) point of the solution space. The simplex method is based funda

Human behavior and budgetary control, Human behavior and budgetary control ...

Human behavior and budgetary control An important feature of control in business is that control is exercised by managers over people. Their attitudes and response to budgetary

Full service non recourse, Full Service Non Recourse: in this method the b...

Full Service Non Recourse: in this method the book debts are purchased through the factor assuming 100 percent credit risk. In case of default through the debtor the whole risk is

What is direct material cost variance, What is Direct material cost varianc...

What is Direct material cost variance It can be defined as the difference between the standard costs of direct material specified and the actual cost of direct material used.

Explain kaizen and management, Kaizen and management Management has two...

Kaizen and management Management has two major components: 1) Maintenance 2) Improvement. The aim of  the maintenance function is to maintain current technological man

Calculate the direct materials costs, XYZ Industries manufactures electroni...

XYZ Industries manufactures electronic testing equipment. XYZ also installs the equipment at customers' sites and ensures that it functions smoothly. Additional information on the

What are the advantages of break even charts, What are the Advantages or us...

What are the Advantages or uses of break even charts Computation of break even point or presentation of cost volume and profit relationship by way of break even charts has the

Assignment, Application of Information technology in respect of management ...

Application of Information technology in respect of management information system

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