Financing_Discussion_Question_2_Answer

Apr 24th, 2015
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Financing_Discussion_Question_2_Answer

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Working Capital Financing (graded) How does management determine how working capital should be financed? I have located the following website link:http://import-export.suite101.com/article.cfm/collecting_on_exports .Why would a company sell its goods and/or services on open account?Reference:http://import-export.suite101.com/article.cfm/collecting_on_exports . While I could not get this link to work, I researched to topic of open accounts. An open account is defined as simply a credit account or credit that is extended to a customer. So, it is beneficial for a company to sell it s goods and services to a business or customer in order to encourage repeat business and/or customer loyalty. I think of it like a store credit card, just about every retailer offers a store credit card, typically with a small discount if you use their card for your purchases. This type of arrangement encourages the consumer not only to shop their store, but use their credit service. Many companies sell their goods and services on open accounts to help increase business. Many companies that sell products and services above daily expense, allow customers to take an extension of credit and/or payment plan. This allows the customer to still purchase the good or service, increasing business, but also allows the company to collect payment in exchange. Think about unexpected car repairs. If you go to have your car fixed and they tell you its $3,000, many people don't expect to shell out that mo

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