Dealer Holdback Allowance | CTFA Exam | ABA

Dealer Holdback Allowance

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Question

Dealer holdback is an allowance:

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Explanations

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A. B. C. D.

D

Dealer holdback is an allowance that a manufacturer gives to a dealer. The purpose of this allowance is to incentivize the dealer to sell the manufacturer's products. The dealer holdback is typically a percentage of the invoice price of the product, and it is paid to the dealer after the sale is completed.

The dealer holdback is typically used in the automotive industry, where manufacturers offer holdbacks to their dealers as a way to incentivize them to sell more vehicles. In this case, the dealer holdback is typically a percentage of the invoice price of the vehicle, and it is paid to the dealer after the sale is completed.

The dealer holdback is not an allowance that is given by a supplier or a wholesaler to the buyer. Rather, it is a manufacturer incentive that is given to the dealer to help drive sales. Therefore, the correct answer is (A) That manufacturer gives to the buyer.