Multiple Choice
In the context of types of receivables, taxes and withholdings most directly impact your:
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7. Receivables and Investments
Types of Receivables
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
A credit score is based in part on which of the following factors?
A
The individual's payment history on receivables
B
The number of employees in the organization
C
The company's total inventory turnover
D
The amount of fixed assets owned
Verified step by step guidance1
Understand the concept of a credit score: A credit score is a numerical representation of an individual's creditworthiness, primarily used by lenders to assess the risk of lending money or extending credit.
Identify the factors that influence a credit score: Credit scores are typically based on personal financial behavior, such as payment history, amounts owed, length of credit history, types of credit used, and new credit inquiries.
Focus on payment history: Payment history is one of the most significant factors in determining a credit score. It reflects whether an individual has consistently paid their debts on time, including credit card bills, loans, and other receivables.
Eliminate irrelevant options: The number of employees in an organization, the company's total inventory turnover, and the amount of fixed assets owned are factors related to business operations and financial accounting, not personal credit scores.
Conclude that the correct factor influencing a credit score is the individual's payment history on receivables, as it directly impacts their creditworthiness.
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