The right of reclamation under the Uniform Commercial Code (UCC) allows credit grantors the right to reclaim goods when the creditor discovers the customer received goods while the customer was insolvent.
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How to Measure Collection Effectiveness
Days Sales Outstanding (DSO)
Days Sales Outstanding (DSO) measures the average number of days it takes a company to collect payment of invoices. Tracking DSO helps a company determine their collection effectiveness and may indicate whether current credit policies and procedures require modification. In the current economy and shifting industry conditions, it is particularly important to monitor collection effectiveness and bad debt write-offs.