Credit

Front 1

What is the definition of credit?

Back 1

A medium of exchange with limited acceptance.

Front 2

3 things credit does for customers

Back 2

1) Improves standard of living
2) Convenience
3) Handles emergencies

Front 3

3 things credit does for business

Back 3

1) Improves bottom line-profit
2) Obtain inventory
3) Acquire financial capital

Front 4

3 things credit does for the economy

Back 4

1) Stabilizes economy
2) fiscal policy
3) monetary policy

Front 5

3 reasons a business offers credit

Back 5

1) generate sales
2) improve customer service
3) meet competition
4) improve profits

Front 6

What is credit managers role within a business organization?

Back 6

Individual responsible for evaluating customer applications and has the power to commit company resources in credit transactions

Front 7

Name 4 goals of credit manager

Back 7

1) Increase sales revenues
2) Control operating costs and expenses
3) Monitor and control receivables
4) Reduce collection expenses and control bad debt
5) Maintain good customer relations

Front 8

Name 5 C's of credit

Back 8

Capacity
Capital
Collateral
Condition
Charactor

Front 9

3 benefits of automated credit approval process

Back 9

1) Ability to use complex mathematical scoring models
2) Faster turnaround of applications
3) Ability to spend more time on questionable applications
4) Easier to trace customer data ie: duplication, fraud and inaccurate information

Front 10

Name 4 things financial statement analysis answers

Back 10

1) Does the company earn adequate profits
2) Does the company have sufficient liquidity
3) Can the company pay it's bils promptly
4) Is the company a good investment

Front 11

What are 4 goals of a good collection system?

Back 11

1) Aid the working capital of the firm
2) Reduce operating expenses and bad debts
3) Customer goodwill
4) Rehabilitate the customer
5) Aid the sales effort
6) Promote good communications with customer