Develop a brief answer to each of the following questions:

1. Name some business whose needs for cash fluctuate during the year. Name some whose needs for cash are relatively stable over the year.

2. Why is it advantageous for a company to finance its receivables?

3. To increase its sales, a company decides to increase its credit terms from 15 to 30 days. What effect will this change in policy have on receivable turn over and days’ sales uncollected?

4. How might the receivable turnover and days sales uncollected reveal that management is consistently underestimating the amount of losses from uncollectible accounts? Is this action ethical?