1.Which depreciation method should a firm choose if it wants to minimize its tax liabilities? a. straight-line depreciation. b. MACRS (Modified Accelerated Cost Recovery System). c. it does not matter whether it is straight-line depreciation or MACRS. d. None of the above are correct

1.Which depreciation method should a firm choose if it wants to minimize its tax liabilities? a. straight-line depreciation. b. MACRS (Modified Accelerated Cost Recovery System). c. it does not matter whether it is straight-line depreciation or MACRS. d. None of the above are correct

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 2P

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2. Probably the safest and most marketable instrument for short-term investment is

a. Commercial paper
b. Large denomination certificates
c. Treasury note
d. Treasury bills.

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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Investment decision function in finance is about اخترأحد الخيارات a. Reducing the liability b. None of the options c. Usage of money on a production process of products and services d. Use of capital for financing assets to receive returns
2. Current asset financing policies How do firms finance their operating current assets? A firm's asset or capital requirements grow over time and usually exhibit temporal (seasonal) variation. Firms must solve the challenge of how to finance their assets with a combination of short- and long-term financing. The following graph exhibits this relationship for a particular firm. DOLLARS Long-term Financing Asset Requirements TIME Which of the following best characterizes this firm's policy of financing assets? Restricted policy Relaxed policy Moderate policy Note the shaded region on the preceding graph. Which of the following statements best describes the firm's situation during this time? The firm has excess capital to invest in cash or marketable securities. The firm must rely on short-term borrowing. The impact of working capital management on return on equity return on equity. Considering all else remains constant, if a firm is using a restricted policy of financing assets, it will…
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