What is the best way for businesses to protect against uncollectible accounts?

Is this for homework or a practical application?

Sounds like a homework question to me.

I'll give you a hint to get started.

One way is to offer discounts. Can you tell me why that is?

Can you think of any other ways?

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Originally Posted by Emland

Is this for homework or a practical application?

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Would the answer be different for either homework or practical application?

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Originally Posted by CaptainForest

sounds like a homework question to me.

i'll give you a hint to get started.

one way is to offer discounts. can you tell me why that is?

can you think of any other ways?

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Thank you ! Offering discounts to clients will give the incentive to pay their bills, versus ignoring them.

Our company requires a deposit to prevent from having accounts go unpaid. We are a service based company and have lower collection problems since we started the practice. We don't have a widget that we can turn off or repossess.

If you are working on homework, this may not be the answer they are looking for.

I discovered while working on my business degree that many of the practices taught in the textbooks look good on paper and the guy that wrote it, who I am quite sure is very smart and educated, never worked a single day in a commercial business.

There's theory and then there's application.

Quote:

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Originally Posted by Emland

Our company requires a deposit to prevent from having accounts go unpaid. We are a service based company and have lower collection problems since we started the practice. We don't have a widget that we can turn off or repossess.

If you are working on homework, this may not be the answer they are looking for.

I discovered while working on my business degree that many of the practices taught in the textbooks look good on paper and the guy that wrote it, who I am quite sure is very smart and educated, never worked a single day in a commercial business.

There's theory and then there's application.

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Thank you, this is good information. You are right, there are different ways to look at how to handle business applications. Some people may be "book smart" but they may not be "street smart" which would make a difference in how situations are handled. What may work for one may not work for another.