course hero which of the following terms of trade credit is the least expensive?

What percentage of a firm's accounts receivable is advanced to the borrowing firm?

A percentage of the value of a firm's accounts receivable pledged (usually about 75 percent ) is advanced to the borrowing firm.26 As customers pay off their accounts, the funds received are forwarded to the lender in repayment of the funds that were advanced.

What is a line of credit?

A line of credit is an agreement by a bank to lend a specified amount of money to the business at any time, if the money is available.

How long does it take for short term financing to be repaid?

Short-term financing raises funds to be repaid in less than a year.

How does equity financing work?

Equity financing raises funds from within the firm through investment of retained earnings, sale of stock to investors, or sale of part ownership to venture capitalists.

What is debt financing?

Debt financing is the sale of bonds to investors and long-term loans from banks and other financial institutions. Equity financing is obtained through the sale of company stock, from the firm's retained earnings, or from venture capital firms.

How long does a forecast last?

predicts revenues, costs, and expenses for a period longer than 1 year, sometimes as long as 5 or 10 years.

What are the major investments in long term assets?

major investments in either tangible long-term assets such as land, buildings, and equipment, or intangible assets such as patents, trademarks, and copyrights.