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If a company sells its receivable to another party to raise funds, it is known as?

<p><span>a- Securitization </span></p> <p><span>b- Factoring</span></p> <p><span><span>c- Pledging </span></span></p> <p><span><span>d- None of the above</span></span></p> <p> </p>

Accounting Accounts Receivable Financial Accounting Financials Finance
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Question added by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town
Date Posted: 2015/01/04
Upvote (8) Views (45) Followers (49) Answers (45) Report Question
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VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Option (b) >>>>>>>>>>>>>  Factoring

Sahar Alech
by Sahar Alech , Auditor / Financial Manager , Accounting Services Office

Factoring is the answer

Nissam Khalid
by Nissam Khalid , Finance Manager , Saudi Specialized Pipes

B) Factoring – It is a type of debt finance in which a business sells its accounts receivables (i.e., invoices) to a third party (called a factor) at a discount. This practice is common in International Trade Finance by Exporters who wish to sell their receivables.

 

Lesley Lanag CMA CPA
by Lesley Lanag CMA CPA , Senior Accountant , Takaful Emarat Insurance (P.S.C)

B. Factoring

 

(Off-Balance Sheet Financing)

Waqas Ali Ilyas Waqas
by Waqas Ali Ilyas Waqas , Accounts & Billing Officer , New Shalimar Steel Industries Pvt Ltd.

b

Deleted user
by Deleted user

b- Factoring

All agreed it

 

I join them

Mir Mujtaba Ali
by Mir Mujtaba Ali , Internal Audit Manager , Confidential

b. factoring - rightly by experts

Deleted user
by Deleted user

Selling its receivables to another party called as Factorizing. Companies do so because they need liquidity in order to meet their day to day activity. although company does incur  some losses in practicing this.

Amit Agrawal
by Amit Agrawal , Manager - Accounts & Finance , Signet Industries Limited

b - Factoring

samir baddour
by samir baddour , Manager Corporate Finance , Baniyas Investments and Development Company

Factoring and receivables are sold at discount

Ayman Mohammad Ahmad Abu Zahieh
by Ayman Mohammad Ahmad Abu Zahieh , Senior Accountant – Acting Financial Manager , RED TAG- Matajir Group

The answer in (D) Factoring.

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