factoring
In a financial context, this term describes a specific type of debtor finance. It is distinct from a standard loan because the business sells an asset (the invoice) rather than borrowing against it. This process is typically used by companies to avoid the wait for client payments and to maintain immediate operational liquidity.
In mathematics, the term refers to the reverse process of multiplication. It is a foundational skill in algebra used to simplify expressions or solve equations by identifying the prime numbers or polynomials that multiply together to reach the original value.
Meanings
The financial practice of selling accounts receivable (invoices) to a third party at a discount to obtain immediate cash flow.
The company improved its liquidity by using factoring to manage its outstanding invoices.
The mathematical process of decomposing a number, polynomial, or matrix into a product of simpler factors.
The student struggled with the factoring of quadratic equations in her algebra class.