Screening debtors can help a business prevent which of the following?

Screening debtors is a crucial process for businesses as it enables them to assess the creditworthiness of potential customers before extending credit. By evaluating the financial stability and payment history of debtors, a business can significantly reduce the risk of future bad debts. Bad debts occur when customers fail to pay for goods or services, leading to losses that can impact the overall financial health of a business. Effective screening helps in identifying reliable customers and allowing only those with a proven track record of timely payments to utilize credit, thereby preventing financial losses associated with uncollectible accounts.

This proactive approach ensures that businesses can maintain healthier cash flows and safeguard their assets against default, promoting overall financial stability. The other options, while relevant to different aspects of business operations, do not directly relate to the practice of debtor screening in the same way that preventing bad debts does. For instance, while employee turnover and operational costs may be influenced by various management decisions and economic conditions, they are not directly mitigated through screening debtors. Similarly, delays in shipment are typically associated with logistics and supply chain issues rather than credit evaluation.