Examples of Trade Credit in a sentence
Trade credit insurance can bridge the traditional gap between the sales department and the credit department, two areas often at odds.
On an on-going basis, the trade credit insurance provider can monitor critical accounts, which incidentally avoids the cost of attempting to do that in-house.4. Competitive advantage: Trade credit insurance gives a firm the ability to quickly match its competitor’s credit limit and pay terms.
Trade credit insurance also provides a more stable and confident environment for sales and marketing to penetrate global markets.3. Financial stability: Receivables in the average company represent up to 40 or more of its balance sheet assets, and therefore, have a major impact on cash flow and how investors and banks view the company’s financial viability.
Valid points include (Any 2 × 1 marks): • Trade credit allows the purchaser to pay for them later (1) after an agreed period of time (1) for goods after they have received them (1)• The credit period will allow the buyer to sell the goods (1) and so pay for them from the proceeds of the sale (1)• The credit period given may vary/for a short period of time (1) and depend on the credit-worthiness of the customer (1) but usually used for trusted/reliable buyers (1) Accept any other relevant points.
Trade credit is taken as the measure of trade credit during the year, divided by total assets.