Which one of the following statements is most correct if a seller extends credit to a purchaser for a period of time longer than the purchaser’s operating cycle? The seller:

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Which one of the following statements is most correct if a seller extends credit to a purchaser for a period of time longer than the purchaser’s operating cycle? The seller:

A. Will have a lower level of accounts receivable than those companies whose credit period is shorter than the purchaser’s operating cycle.

B. Is, in effect, financing more than just the purchaser’s inventory needs.

C. Is, in effect, financing the purchaser’s long-term assets.

D. Has no need for a stated discount rate or credit period.

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