A company may have many customers—perhaps thousands of them. It must decide, for each one, how much credit it will extend, the time period before which each payment is due, and the size and nature of any discounts given. This can be a monumental task,... 

A serious control problem arises when there is no formal definition of how to calculate a credit limit, what information is required of customers in order to determine the credit limit, the standard terms of sale, and the collections methodology to be... 

It can be quite difficult to determine an appropriate credit level for a customer, since the amount of investigation required to develop an accurate picture of a potential customer’s financial situation may exceed the time available to the credit department. Accordingly,...