PRC-3 · Chapter 4 · Question 3 of 65
A furniture manufacturer receives raw wood from a supplier and agrees to pay the invoice in 45 days without any interest. What specific type of financing is the manufacturer utilizing?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Trade credit
Explanation
Trade credit exists when a purchaser orders and receives goods but pays the supplier after a mutually agreed upon period of time.
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