In doing this question I’m really confused about this statement that factor claims that outstanding receivables balance would reduce by 30% shouldn’t that mean factor took responsibility of 30% of receivables rather than as suggested by answer he took 70% responsibility ?
One benefit of using a factor is that they will (hopefully) be able to collect receivables sooner. In this question, the fact that they will be more efficient at collecting debts is what is making the total receivables 30% lower.