In other words, equity represents the net assets of the company. In accounting, every financial transaction affects at least two accounts due to the double-entry bookkeeping system. This system is a cornerstone of accounting that dates back centuries. Here’s a table summarizing the normal balances of the accounting elements, and the actions to increase or […]
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A good average collection period depends on your industry, business model, and customer base. Generally, a shorter period is desirable, as it indicates efficient payment collections and strong cash flow management. Collection delays impact operational efficiency and increase the risk of bad debt expenses. Organizations evaluate credit policies, strengthen collection procedures, and monitor customer payment
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