Study On The Influencing Factors Of Commercial Credit Granting Of Lingyuan Iron And Steel Corporation

The article explores the influencing factors of commercial credit granting in a corporation when it faced with the loan crunch and overcapacity.Based on the analysis of internal and external environment and relevant theoretical,the author makes a hypothesis on the factors such as bank loan,stock price,product marginal contribution and Inventory turnover ratio,clients' location and ownership and so on.Based on the Ordered Probit model,the accounting information of sales business of Lingyuan Iron & Steel Co.,Ltd.in the first three quarters of 2016 was used as the research data to test whether the relevant assumptions of the factors influencing the commercial credit granting were established.The results show that the factors such as bank loans,stock price,clients' intimacy,ownership,account receivable turnover rate,marginal contribution rate of product and other factors significantly affect the enterprise's commercial credit granting behavior.The conclusion of the study confirms the influence that client related attributes and product accounting information have on business credit,and takes the new variables that are not considered in the original customer credit rating and credit sales calculation into the new model.The relationship between the marginal contribution rate and the inventory turnover rate of the product and the commercial credit granting explains the inherent mechanism how cash cow products gain the ability to create cash inflows.