Factoring

Q.

Write a note on commercial Banks. Explain the merits and limitations.

Q.

Loans from commercial banks is a flexible source of finance.

1. True

2. False

Q.

Factoring is

1. A mathematical procedure frequently used in accounting

2. Done by people called fractioners

3. Simplified method developed for counting inventory

4. A way companies can get cash quickly

Q.

What are the benefits of MSME?

Q.

Recourse and non-recourse are a part of which source of finance?

1. Debentures

2. Retained Earnings

3. Trade Credit

4. Factoring

Q.

Which of the sources of finance is expensive when the invoices are numerous and smaller in amount?

1. Retained Earning

2. Factoring

3. Equity Shares

4. Trade Credit

Q.

Explain the following source of business finance :

(i) ADR

(ii) Trade Credit

Q.

Is marshalling the same as serialization?

Q.

The difference between non-recourse as opposed to recourse factoring is that the company has no liability with any uncollected invoices.

1. True

2. False

Q.

Who initiated factoring in the Indian financial scene in the early nineties?

1. SBI

2. RBI

3. UTI

4. All of the above

Q.

Factoring as the source of funds is flexible.

1. True

2. False

Q.

How do I increase my trade credit?

Q. Factoring is a transaction in which a business sells its invoices, or receivables, to a third-party financial company known as a factor.

1. True
2. False

Q. Which is not a service of a factor?

1. Administrating Sales Ledger
2. Advancing against Credit Sales
3. Assuming bad Debt losses
4. None of the above

Q. Bad debt cost is not borne by factor in case of ____________.

1. Pure Factoring
2. None of the above
3. With Recourse Factoring
4. Without Recourse Factoring

Q. If a company sells its debtors to another party to raise funds, it is known as _______________.

1. Pledging
2. Securitization
3. None of the above
4. Factoring

Q. Factoring as a source of funds is flexible and ensures a definite pattern of cash inflows from credit sales.

1. False
2. True

Q. It is expensive if the invoices are multiple but high in amount.

1. True
2. False