Liberty BUSI 320 Chapter 6 Reading Assignment Answers Complete Solutions
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Firms with predictable cash flow patterns typically can maintain lower liquidity
A higher use of long term financing is the more conservative financing approach and can lead to potentially higher profitability
The low current ratios of between 1.2 and 1.5, since 2000 can be traced to:
In developing a sales forecast, total projected sales (in dollars) can be calculated by multiplying the
A risk of using short term funds to finance operation is
Generally, when a company’s sales increase, the affect on temporary and permanent asset is
STATUS
Your company valuation reaches a high of $100,000 before its busy season and a low of $30,000 during its slow season. The $30,000 level of inventory is considered to be
Cash receipts include
Since 1960, the percentage of net working capital divided by sales, for large US nonfinancial companies has trended lower due to
If a company uses short term debt to finance permanent current assets and fixed assets
Normally it is most appropriate to finance seasonal increase in current assets with an
Self liquidating assets are
A point of sale terminal
As a rule, interest rates on short term debts are ______ interest rates on long term debt.
Assume that current assets and current liabilities change at he same rate as changes in sales. Therefore if sales increases by 10%, then
If a company utilizes level production
As a rule, an aggressive risk oriented firm will use _____financing
Normally it is most appropriate to finance permanent current assets with
Place the following steps in the correct