alleryStart learning →Trade credit is granted to creditworthy companies by their:
AVendors
BVoters
CValets
DViolins
Answer & Solution
Correct answer: A. Vendors
1. Trade credit arises when a company buys before it pays.
2. The party extending it is the one supplying the goods.
3. Trade credit is granted by vendors to creditworthy companies.
4. It covers purchases of materials, inventory and services.
_Source: OpenStax Principles of Finance (CC BY 4.0), Ch 19 'The Importance of Trade Credit and Working Capital in Planning', sections 19.1-19.5_
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