Credit period
Credit period is length of time allowed for payment of goods sold on account.
Definitions
According to College Accounting: A Practical Approach by Slater (13th edition),
- Credit period. Length of time allowed for payment of goods sold on account.
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Credit period. The length of time for which credit is extended. If the credit period is lengthened then sales will generally increase, as will accounts receivable. This will increase the firm's financing needs and possibly increase bad debt losses. A shortening of the credit period will have the opposite effect.
Related concepts
- Accounting (alternatively known as accountancy) is management of financial data, information, and knowledge about financial transactions of legal entities. Accountancy tends to include bookkeeping and, depending on a particilar enterprise, may also include quatitative analysis of financial data in the bookkeeping system and/or business intelligence.
