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Recievables

This topic has 1 reply, 2 voices, and was last updated 6 years ago by f6ali.

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December 4, 2018 at 1:20 pm #487177
snahs
Participant
- Topics: 9
- Replies: 14
I was doing a FM mock exam,
The question:
A company has sold its trade receivables at a discount to another party with possible recourse.
a- Letter of credit
B- Factoring
c- Forfaiting
d- Invoice discounting
The answer is B
but why not c
December 4, 2018 at 1:42 pm #487182
f6ali
Member
- Topics: 10
- Replies: 342
Because the question mentions ‘with possible recourse’. Forfaiting is usually non-recourse. Factoring can be with recourse and non-recourse.
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