Factoring Process 0% 52 What is the first step a business must take to initiate an invoice factoring transaction? Sending the invoice to the debtor Negotiating payment terms with the debtor Conducting a credit check on the debtor Submitting an application to the factoring company Which of the following best describes the role of the notice of assignment in the factoring process? A document that transfers ownership of the seller's assets to the factor A legal agreement that outlines the terms of the factoring arrangement A financial statement that details the seller’s receivables A notification to the debtor that payment should be made directly to the factor What occurs after the factor has advanced the funds to the seller under non-recourse factoring? The seller knocks off the account receivable in the balance sheet The debtor pays the factor according to the original invoice terms The factor takes over the management of the seller's receivables assigned to the factor The factor files a legal claim against the seller What is the final step in the factoring process once the debtor has paid the factor? The seller repays the factor with interest The factor returns any remaining balance to the seller after deducting fees The seller issues a new invoice to the debtor The debtor sends a confirmation letter to the seller In a non-recourse factoring agreement, what happens if the debtor defaults on payment? The debtor must provide collateral to the factor The seller must refund the advance to the factor The factor absorbs the loss The factor can seize the seller's assets After the factoring company approves the application, what is the next step in the factoring process? The seller receives the full invoice amount from the factor The seller submits invoices to the factor for funding The factor sends a payment request to the debtor The seller negotiates a discount rate with the debtor What determines the advance rate that the factor provides to the seller? The past payment track record between the seller and the buyer The amount of debt the seller carries The seller's total revenue The debtor's creditworthiness and the terms of the invoice Please enter your name and email address to view the results. Your score is The average score is 49% LinkedIn Facebook Twitter 0%
