Question

Assume you own and run a small ice cream shop located on the grounds of a private pool. You want to maximize sales and decide that allowing customers to buy on credit could be a big driver of sales since most people come to the pool without cash. What information do you need to keep track of to make sure a given customer doesn’t go over their $20 credit limit? What problems might occur?

Answer 1

Concept

Credit limit is the maximum amount of money a lender will allow you to spend on credit card or a line of credit.

To answer

To find the information we need to keep track of customers.

Explanation

To keep a track of information of a customer so that the limit does not go over $20 credit limit, we need to write their names and the amount of things the customer buys each time. The problems which can occur are:

1. People may not come back again.
2. People may give wrong information.
3. Private park owners may angry.
4. Many children will come to the ice cream shop instead of people.

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Answer 2

Answer:

There are multiple problems with the concept of crediting money in every business venture.

Explanation:

We have learned that the credit limit basically refers to the maximum money a lender will allow you to spend credit-wise, i.e., the amount that you can pay back later.

As a businessman, we need specific information to keep the cash flow of the business in check with a lot of care and concern, so as to not lose out on money that our customers owe us.

To do so, we allow only the regular customers (who are credible) to exercise credit limits, while the others will have to build their way up. Even the customers with a credit limit must submit an identity proof, which must be well-documented.

Next, once credit limit allowances are open, we need to write their names along with the amount they owe us.

However, despite being fully careful, there are multiple issues with the concept of credit limit like -

• People won't come back to the store after buying things once
• People can always give in the wrong details
• Children with no proof walk in, and can't be asked to pay money.

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