Chapter 5, Problem 13DQ

To determine

Credit Sales:

Credit sale is a way to encourage buyers and increase sales. Companies have to sale on credit instead the sales will be reduced and the profitability will be affected. Moreover, it is true that payments are sometimes getting uncollected but companies take it as an expense but cannot deny the credit sales for the business.

The reason for providing the credit sales after knowing the fact that there are some buyers whose amount will be uncollected.