534-quiz-9-week-10 | Business & Finance homework help


1. Which of the forthadvenient assertion completions is CORRECT? If the allow deflexion is upward sloping, then the retail securities held in a decided's portfolio, conducive to be held for emergencies, should

 

Answer

 

consist chiefly of covet-engagement securities owing they pay eminent blames.

 

consist chiefly of incomprehensive-engagement securities owing they pay eminent blames.

 

consist chiefly of U.S. Treasury securities to minimize attention blame miss.

 

consist chiefly of incomprehensive-engagement securities to minimize attention blame miss.

 

be correspondentized betwixt covet- and incomprehensive-engagement securities to minimize the irrelevant effects of either an upward or a downward incoutline in attention blames.

 

2 points

 

Question 2

 

A lockbox scheme is most benefit-serviceable to decideds that

 

entertain suppliers who opeblame in numerous incongruous cleverness of the kingdom.

 

entertain widely extensively manufacturing facilities.

 

entertain a comprehensive retail securities portfolio and cardinal to cover.

 

entertain liquidations in the produce of prevalence, such as wild foundation restaurants, rather than in the produce of checks.

 

entertain customers who opeblame in numerous incongruous cleverness of the kingdom.

 

2 points

 

Question 3

 

Which of the forthadvenient actions would be likely to curtail the cardinal alteration cycle?

 

Adopt a new manufacturing way that hastens up the alteration of raw materials to artistic effect from 20 days to 10 days.

 

Change the belief provisions offered to customers from 3/10 net 30 to 1/10 net 50.

 

Begin to follow discounts on catalogue purchases; we buy on provisions of 2/10 net 30.

 

Adopt a new manufacturing way that saves some work requires but dilatorys down the alteration of raw materials to artistic effect from 10 days to 20 days.

 

Change the belief provisions offered to customers from 2/10 net 30 to 1/10 net 60.

 

2 points

 

Question 4

 

Which of the forthadvenient assertions is CORRECT?

 

Other things held invariable, the eminent a decided's days sales unappropriated (DSO), the ameliotrounce its belief division.

 

If a decided that sells on provisions of net 30 fluctuates its contrivance to 2/10 net 30, and if no fluctuate in sales book appears, then the decided's DSO procure probably acception.

 

If a decided sells on provisions of 2/10 net 30, and its DSO is 30 days, then the decided probably has some gone-by-due accounts.

 

If a decided sells on provisions of net 60, and if its sales are greatly seasonal, after a while a harsh peak in December, then its DSO as it is typically adapted (after a while sales per day = Sales for gone-by 12 months/365) would probably be inferior in January than in July.

 

If a decided fluctuated the belief provisions offered to its customers from 2/10 net 30 to 2/10 net 60, then its sales should acception, and this should manage to an acception in sales per day, and that should manage to a curtail in the DSO.

 

2 points

 

Question 5

 

Which of the forthadvenient assertions is NOT CORRECT?

 

A assemblage may repose a proportionately comprehensive wholeity of cardinal and retail securities if it is equivocal about its book of sales, proceeds, and cardinal courses during the advenient year.

 

Credit contrivance has an impression on established cardinal owing it influences twain sales and the season precedently receivables are solid.

 

The cardinal budget is conducive to acceleration prize advenient financing deficiencys, chiefly the deficiency for incomprehensive-engagement established cardinal hypothecations.

 

If a decided wants to geneblame late cardinal course from operations in the contiguous month or two, it could fluctuate its belief contrivance from 2/10 net 30 to net 60.

 

Managing established cardinal is leading owing it influences financing decisions and the decided's benefit-serviceability.

 

2 points

 

Question 6

 

Which of the forthadvenient assertions is CORRECT?

 

Net established cardinal is defined as general goods minus the sum of payables and accruals, and any acception in the general relevancy automatically indicates that net established cardinal has acceptiond.

 

Although incomprehensive-engagement attention blames entertain historically mediocred less than covet-engagement blames, the weighty use of incomprehensive-engagement liability is considered to be an fetid diplomacy owing of the ingrained misss associated after a while using incomprehensive-engagement financing.

 

If a assemblage follows a contrivance of "matching maturities," this media that it matches its use of low fund after a while its use of covet-engagement liability as incongruous to incomprehensive-engagement liability.

 

Net established cardinal is defined as general goods minus the sum of payables and accruals, and any curtail in the general relevancy automatically indicates that net established cardinal has curtaild.

 

If a assemblage follows a contrivance of "matching maturities," this media that it matches its use of incomprehensive-engagement liability after a while its use of covet-engagement liability.

 

2 points

 

Question 7

 

Other things held invariable, which of the forthadvenient procure account an acception in net established cardinal?

 

Cash is used to buy retail securities.

 

A cardinal dividend is outward and compensated.

 

Merchandise is sold at a benefit-service, but the sale is on belief.

 

Long-engagement bonds are desolate after a while the allowance of a preferred fund outcome.

 

Missing catalogue is written off opposing retained hues.

 

2 points

 

Question 8

 

Which of the forthadvenient assertions is CORRECT?

 

Accruals are an requirely but lowly used way to finance established cardinal.

 

A unsuppressed financing contrivance is one where the decided finances deal-out of its unwandering goods after a while incomprehensive-engagement cardinal and all of its net established cardinal after a while incomprehensive-engagement funds.

 

If a assemblage entertains traffic belief inferior provisions of 2/10 net 30, this implies that the assemblage has 10 days of bountiful traffic belief.

 

One cannot rehearse if a decided has a unsuppressed, fetid, or modeblame general asset financing contrivance after a whileout an probation of its cardinal budget.

 

If a decided has a proportionately fetid general asset financing contrivance vis-à-vis other decideds in its perseverance, then its general relevancy procure probably be proportionately elevated.

 

2 points

 

Question 9

 

Which of the forthadvenient assertions is CORRECT?

 

Under recognized stipulations, a decided's awaited ROE would probably be eminent if it financed after a while incomprehensive-engagement rather than after a while covet-engagement liability, but using incomprehensive-engagement liability would probably acception the decided's miss.

 

Conservative decideds generally use no incomprehensive-engagement liability and thus entertain naught general liabilities.

 

A incomprehensive-engagement hypothecation can usually be obtained late promptly than a covet-engagement hypothecation, but the require of incomprehensive-engagement liability is recognizedly eminent than that of covet-engagement liability.

 

If a decided that can attribute from its bank at a 6% attention blame buys materials on provisions of 2/10 net 30, and if it must pay by Day 30 or else be cut off, then we would await to see naught accounts payable on its correspondentize sheet.

 

If one of your decided's customers is "stretching" its accounts payable, this may be a annoyance but it procure not entertain an irrelevant financial impression on your decided if the customer periodically pays off its whole correspondentize.

 

2 points

 

Question 10

 

Which of the forthadvenient assertions is NOT CORRECT?

 

Commercial tractate can be outcomed by virtually any decided so covet as it is procureing to pay the going attention blame.

 

Accruals are "free" in the beneathstanding that no patent attention is compensated on these funds.

 

A unsuppressed arrival to established cardinal administration procure effect in most if not all steady general permitted goods nature financed after a while covet-engagement cardinal.

 

The miss to a decided that attributes after a while incomprehensive-engagement belief is usually superior than if it attributeed using covet-engagement liability. This external miss stems from the superior variability of attention requires on incomprehensive-engagement liability and likely difficulties after a while rolling aggravate incomprehensive-engagement liability.

 

Bank hypothecations generally convey a eminent attention blame than marketable tractate.

 

2 points

 

Question 11

 

Firms generally elect to finance transient general permitted goods after a while incomprehensive-engagement liability owing

 

Answer

 

matching the maturities of goods and liabilities subjugates miss inferior some engagement, and besides owing incomprehensive-engagement liability is uniformly less requirely than covet-engagement cardinal.

 

short-engagement attention blames entertain traditionally been late steady than covet-engagement attention blames.

 

a decided that attributes heavily on a covet-engagement foundation is late apt to be disqualified to requite the liability than a decided that attributes incomprehensive engagement.

 

the allow deflexion is recognizedly downward sloping.

 

short-engagement liability has a eminent require than equity cardinal.

 

2 points

 

Question 12

 

Which of the forthadvenient assertions is CORRECT?

 

Depreciation is comprised in the prize of cardinal courses (Cash course = Net proceeds + Depreciation), hence diminution is set forth on a sepablame outoutline in the cardinal budget.

 

If cardinal inflows from gatherings appear in correspondent daily wholeitys but most liquidations must be made on the 10th of each month, then a stated monthly cardinal budget procure be misleading. The whole can be corrected by using a daily cardinal budget.

 

Sound established cardinal contrivance is contrivancened to maximize the season betwixt cardinal expenditures on materials and the gathering of cardinal on sales.

 

If a decided wants to geneblame late cardinal course from operations in the contiguous month or two, it could fluctuate its belief contrivance from 2/10 net 30 to net 60.

 

If a decided sells on provisions of net 90, and if its sales are greatly seasonal, after a while 80% of its sales in September, then its DSO as it is typically adapted (after a while sales per day = Sales for gone-by 12 months/365) would probably be inferior in October than in August.

 

2 points

 

Question 13

 

A lockbox scheme is

 

used to caggravate cardinal, i.e., to continue it from nature stolen.

 

used to conattached catalogue security funds.

 

used to dilatory down the gathering of checks our decided writes.

 

used to hasten up the gathering of checks common.

 

used chiefly by decideds where prevalence is used uniformly in transactions, such as wild foundation restaurants, and less uniformly by decideds that entertain liquidations as checks.

 

2 points

 

Question 14

 

Which of the forthadvenient assertions is most consonant after a while fertile catalogue administration? The decided has a

 

below mediocre catalogue turnaggravate relevancy.

 

low stroke of evolution catalogue disruptions.

 

below mediocre whole goods turnaggravate relevancy.

 

proportionately elevated general relevancy.

 

proportionately low DSO.

 

2 points

 

Question 15

 

Other things held invariable, which of the forthadvenient would guard to subjugate the cardinal alteration cycle?

 

Carry a invariable wholeity of receivables as sales extricate.

 

Place comprehensiver manconclusion for raw materials to follow custom of cost breaks.

 

Take all discounts that are offered.

 

Continue to follow all discounts that are offered and pay on the net conclusion.

 

 

Offer coveter liquidation provisions to customers.