What are some methods firms can use to accelerate receipts?

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What are some methods firms can use to accelerate receipts?

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What are some methods firms can use to accelerate receipts?

Explanation & AnswerSolution by a verified expert

Explanation

Two methods with the help of which processing of receipts can be accelerated are as follows:

Lockboxes - It is a technique under which payments made by customers are directed to a special post office box instead of going to the company.

This technique helps the firm in reducing its mailing, processing, and collecting time and minimizing the firm's cost and the possibility of fraud.

Electronic payments - Under this system, generally the large bill payments are made through electronic payments options. This technique helps the firm in clearing and settling its transactions more quickly.

Verified Answer

Methods that can be used to accelerate receipts are as follows:

Lockboxes - It is a type of service provided to customers by the banks to speed up collections and lower processing costs. Under this, the parties send the cheque to the post office boxes rather than the company's headquarters.
Electronic payments  - It is a kind of non-cash transaction that does not include any kind of paperwork. Some methods of electronic payments are credit card, debit card, automated clearing house network.

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