FINANCIAL MANAGEMENT(LL)-TEXT
16th Edition
ISBN: 9781337902618
Author: Brigham
Publisher: CENGAGE L
expand_more
expand_more
format_list_bulleted
Question
Chapter 12, Problem 2Q
Summary Introduction
To choose: The items which rises spontaneously with rises in sales.
Expert Solution & Answer
Explanation of Solution
Accrued wages, accounts payable and accrued taxes rise spontaneously.
Want to see more full solutions like this?
Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!
Students have asked these similar questions
Some liability and net worth items increase spontaneously with increases insales. Put a check (✓) by the following listed items that typically increasespontaneously:Notes payable to banks______________________
16. What do you call for the likelihood of loss due to customers are not paying their amounts owing?
a.
Discount risk
b.
Credit risk
c.
Payment risk
d.
Loss risk
Which one of the following statements is correct?
A.
If a firm decreases its inventory period, its accounts receivable period will also decrease.
B.
The longer the cash cycle, the more cash a firm typically has available to invest.
C.
A firm would prefer a negative cash cycle over a positive cash cycle.
D.
Decreasing the inventory period will also decrease the payables period.
E.
Both the operating cycle and the cash cycle must be positive values.
Chapter 12 Solutions
FINANCIAL MANAGEMENT(LL)-TEXT
Ch. 12 - Prob. 2QCh. 12 - Prob. 3QCh. 12 - Prob. 4QCh. 12 - What is meant by the term “self-supporting growth...Ch. 12 - Suppose a firm makes the following policy changes...Ch. 12 - Broussard Skateboard’s sales are expected to...Ch. 12 - Berman & Jaccor Corporation’s current sales and...Ch. 12 - Smiley Corporations current sales and partial...Ch. 12 - Maggie’s Muffins Bakery generated $5 million in...Ch. 12 - At year-end 2019, Wallace Landscapings total...
Ch. 12 - The Booth Company’s sales are forecasted to double...Ch. 12 - Upton Computers makes bulk purchases of small...Ch. 12 - Stevens Textile Corporations 2019 financial...Ch. 12 - Hatfield Medical Supplys stock price had been...Ch. 12 - Use the AFN equation to estimate Hatfield’s...Ch. 12 - Prob. 3MC
Knowledge Booster
Similar questions
- What are some possible negative signals when the product of the accounts receivable turnover ratio is lower (i.e., fewer times)?arrow_forwardIf a bank has a positive repricing gap (RSAs > RSLs), then: Does this bank have reinvestment or refinancing risk? If interest rates increase, net interest income will: A. Reinvestment risk, increase B. Reinvestment risk, decrease C. Refinancing risk, increase D. Refinancing risk, decreasearrow_forwardWhat is an earnings management benefit from showing an increased figure for bad debt expense?arrow_forward
- 1. Modes of extinguishing obligations when creditor abandons his right to collect. (PLEASE EXPLAIN YOUR ANSWER) A. Condonation B. Forfeiture C. Debt D. Damages 2. Fall after the increase reaches a certain variable amount, this is called: (PLEASE EXPLAIN YOUR ANSWER) A. Process factor B. Law of return C. Inflation D. Supply & demand 3. It is always true that the effective rate is greater than the nominal rate when m ≥ 2. (PLEASE EXPLAIN YOUR ANSWER) A. True B. False 4. (A/F, i%, N) = (A/P, i%, N) + i (PLEASE EXPLAIN YOUR ANSWER) A. True B. Falsearrow_forwardWhat is cumulative effect of changing the estimated bad debit ratearrow_forwardConcerning factoring, all of the following are true except? * factoring is done at a discount to the third party purchaser factoring speeds the inflow of cash to the seller of the receivables receivable lending is the process of factoring factoring discounts are often a function of the riskiness of the receivablesarrow_forward
- The purpose of the inflation premium is to maintain the purchasing power of money while it is loaned to someone else. TTrueFFalse What kind of problem bad credit risks people pose to financial intermediaries ? AMoral hazard BNone of the above CAdverse Selection DFree-ridingarrow_forwardWhich of the following best represents a positive product of a lower number of days sales in receivables ratio? A. collection of receivables is quick, and cash can be used for other business expenditures B. collection of receivables is slow, keeping cash secured to receivables C. credit extension is lenient D. the lender only lends to the top 10% of potential creditorsarrow_forwardWhich of the following transactions would result in an increase in capital employed? A. Paying a trade payable in cash B. Writing off a bad debt C. Purchasing on credit D. Repaying a loan E. Selling inventory at a profit F. Increasing the bank overdraft to purchase a non - current assetarrow_forward
- The static GAP focuses on monitoring net interest income in the long term. Select one: True Falsearrow_forwardWhat information can best be elicited from a receivable ratio? A. company performance with current debt collection B. credit extension effect on cash sales C. likelihood of future customer bankruptcy filings D. an increase in future credit sales to current customersarrow_forwardQuestion If the % of uncollectible accounts does not change, there cannot be a savings for this concept simply because of a decrease in sales. true or false?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
- EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT