A student who knows the material well does not derive benefit from repeating what they already know. Repeating would be a waste of time and tuition that could otherwise be used for a free elective (perhaps later). Would you rather pay to repeat calculus 1 if the student knows the material well (based on the college’s old calculus 1 final exams) or learn something new?
Of course, it does vary by subject. AP physics is less likely to be a match in material coverage and depth to introductory college physics courses, compared to AP calculus. But that can be determined by the college’s (often non-)acceptance of AP physics credit and/or the college’s old physics final exams.