Final answer:
For exporting and importing parties with a strong, long-standing relationship, sales on open account is the typical method of financing used, reflecting a high level of trust and eliminating the need for advance payments or documentary proofs.
Step-by-step explanation:
If the exporting and importing parties have a strong, long-standing relationship, they are likely to use sales on open account as their method of financing. This arrangement is based on mutual trust and does not require documentation or advance payments.
Sales on open account allow the importer to receive and sell goods before paying the exporter, which demonstrates a significant level of trust between the two parties. It is thus the most advantageous option for the importer and a display of good faith on the part of the exporter.
The other methods mentioned in the question, such as documentary credit (letter of credit), documentary collection, cash in advance, and bank draft, involve more security features, which are typically used when trust levels between trading partners are not as high, or when trade agreements are more formal or regulated.
A letter of credit, for instance, adds a layer of security for both parties by involving a bank's guarantee of payment.
Therefore, the correct answer is D) sales on open account.