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A large manufacturing firm has been selling on a 3/10, net 30 basis. The firm changes its credit terms to 2/20, net 90. What change

A large manufacturing firm has been selling on a 3/10, net 30 basis. The firm changes its credit terms to 2/20, net 90. What change might be expected on the balance sheets of its customers?

Multiple Choice

  • Decreased receivables and increased bank loans.

  • Increased receivables and increased bank loans.

  • Increased payables and decreased bank loans.

  • Increased payables and increased bank loans.

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