Answer This Accounting Question – Accepting Bank Credit Cards Represents One Way To Decrease?

If you have a good credit score and you are old enough to apply for a credit card, this accounting question is for you – accepting bank credit cards represents one way to decrease? Read on to find out what the answer to this question is.

The Accounting Question: accepting bank credit cards represents one way to decrease?

Question – accepting bank credit cards represents one way to decrease? 

This accounting question comes with four answer options. However, only one of the answer options provided is the correct answer. You have to choose which one of the four answers you feel is the accurate one.

The four possible answer options are listed below:

A. equity financing.

B. the expense of collecting accounts payable.

C. capital expenditures.

D. the expense of collecting accounts receivable.

So which of these four answer options is the correct one?

Accepting bank credit cards represents one way to decrease? – The Answer and why

The most logical answer to this accounting question out of the four possible answers provided is the option “D”. This is the correct answer out of the four itemized answers. So accepting bank credit cards represents one way to decrease the expense of collecting accounts receivable. Do you know why this is the best answer? If you are not yet sure that this option correctly answers the question, a more detailed explanation should convince you. This answer is explained better below.

Explaining the chosen answer in more detail

If you pay for a commodity with your credit card, the store from which you bought the commodity is sure of receiving payment from the credit card issuing bank. The store could care less if your outstanding credit card bill has been settled with your bank or not. This is why “D” is the right answer.