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i. The administrative costs of debt collection
ii. The procedures for controlling credit to individual customers and for debt
collection
iii. The amount of extra capital required to finance an extension of total
credit.
iv. The cost of the Additional finance required for any increase in the volume of
debtors.
v. Any savings or additional expenses in operating the credit policy, for example the
extra work involved in pursuing slow payers.
vi. The ways in which credit policy could be implemented e.g.
a. Credit period could be eased by giving debtors a longer period in which to
settle their accounts.
b. A discount could be offered for early payments
vii. The effects of easing credit, which might be to encourage a higher proportion of
bad debts, and an increase in sale volume.
NatalieR answered the question on June 17, 2022 at 07:13
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