Credit Management Essay Example | Topics and Well Written Essays - 1250 words

Credit Management - Essay ExampleThe six specific items of information those are available from a cooperative cashbox source are agreement details, g everywherenment registration, balance sheet details, tax return details, reserve bank registration and annual banking transactions. (Lock, 330)It should be taken into pecker the relevancy of marketable securities depend on the nature of those marketable securities depending on the formulated ascertained value projected. From the character reference-grantors standpoint the best practical marketable securities would be those that are easily liquidated and low in risk. (Lock, 19)The major advantage of a customers accounts receivable that is ageing is that this would be one of the most applicable means of guarantor possible. Apart from that there remains chance that if used properly this customers accounts receivable would fetch more premium than the customers own capacity. (Lock, 176)To ascertain the consistency of the customer over a period of time the value of Spreading successive balance sheets on comparison forms is one of the most advantageous instruments for the credit grantor. This is the best possible proof of the customers credibility. (Lock, 119)There are several advantages of setting credit lines for established customers but the most important could be defined as mutual gain in terms of trust obtained. The second can be treated as goodwill calculation theory that allows the client to benefit from the credit line. thirdly it becomes important for the company to overlook few objectives as the customer is tested and proved. (Lock, 22)9.) You hold a $30,000.00 order from a customer whose regular line of credit is $10,000.00. The customer explains that this out-of-routine order will cover their needs for the next 90 days. The customer has always been prompt and owes nothing at present. Explain why you would get this order for triple your credit line The prime reason of granting this order to the custom er is that the customers credibility is well tested and proved. Thus it becomes obvious that the customer is to be trusted as a credit line is already established. However, with the assurance from the customer it could be enumerated safe to grant this order. (Lock,