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Ray has asked you to review the company's (SPP) short-term financing policies. To assist you getting...

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Finance

Ray has asked you to review the company's (SPP) short-termfinancing policies. To assist you getting started, he has preparedsome questions that will give Ray a better idea of the company'sshort-term financing policies. a. What is short-term credit, andwhat are the major sources of credit? b Is there a cost to accruedliabilities? Fully explain your rationale. c. What control docompany's have over accrued liabilities? d. SPP is consideringusing secured short-term financing. What is a secured loan? Whattypes of current assets can be used to secure the loans? e. Whatare the differences between pledging receivables and factoringreceivables?

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a Short term credit A short term creditloan is a type of loan that is obtained to support a temporary personal or business capital need As it is a type of credit it involves a borrowed capital amount and interest that needs to be returned or paid back at a given due date which is usually within a year from getting the loan Sources of short term creditloan the ten main sources of shortterm fund The sources are 1 Indigenous Bankers 2 Trade Credit 3 Instalment Credit 4 Advances 5 Factoring 6 Accrued Expenses 7 Deferred Incomes 8 Commercial Paper 9 Commercial Banks 10 Public Deposits b Accrued Liability An accrued liability is an expense that a business has    See Answer
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Ray has asked you to review the company's (SPP) short-termfinancing policies. To assist you getting started, he has preparedsome questions that will give Ray a better idea of the company'sshort-term financing policies. a. What is short-term credit, andwhat are the major sources of credit? b Is there a cost to accruedliabilities? Fully explain your rationale. c. What control docompany's have over accrued liabilities? d. SPP is consideringusing secured short-term financing. What is a secured loan? Whattypes of current assets can be used to secure the loans? e. Whatare the differences between pledging receivables and factoringreceivables?

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