a. Modern Medical Devices has a current ratio of 0.5. Which of thefollowing actions would improve (i.e., increase) this ratio?• Use cash to pay off current liabilities.• Collect some of the current accounts receivable.• Use cash to pay off some long-term debt.• Purchase additional inventory on credit (i.e., accounts payable).• Sell some of the existing inventory at cost.
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a. Modern Medical Devices has a current ratio of 0.5. Which of the
following actions would improve (i.e., increase) this ratio?
• Use cash to pay off current liabilities.
• Collect some of the current accounts receivable.
• Use cash to pay off some long-term debt.
• Purchase additional inventory on credit (i.e., accounts payable).
• Sell some of the existing inventory at cost.
Step by step
Solved in 2 steps
- Which of the following is true? a. A credit entry will increase a long-term loan A credit entry will increase accounts payable A credit entry will increase profit b. A debit entry will increase current assets A debit entry will decrease capital A debit entry will increase profit c. A debit entry will increase receivables A credit entry will decrease current liabilities A credit entry will increase profit d. A debit entry will decrease drawings A debit entry will increase accounts receivable A debit entry will decrease accounts payableWhich 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 creditorsWhat is the effect of the following situations on the cost of accounts receivable financing? (A) A more thorough credit check is undertaken. (B) Receivables are sold without recourse CHOOSE THE LETTER OF CORRECT ANSWERA. (A) Increase; (B) DecreaseB. (A) Decrease; (B) IncreaseC. (A) Decrease; (B) DecreaseD. (A) Increase; (B) IncreaseE. (A) Increase; (B) No effect
- For the following transactions, show which Balance Sheet line items will be affected and if the effect will result in the line item increase or reduction. • Purchase a Treasury Bill for cash• Client withdraws savings• Receive a donation• A current loan becomes past due• Purchase motorcycle for staff with short-term creditGRX, Inc. has a current ratio of 4:1. Which of the following transactions wouldnormally increase its current ratio? a. Purchasing inventory on account b. Purchasing machinery for cashc. Selling inventory on accountd. Collecting on account receivableMoving to another question will save this response. Question 5 The purchase of good on credit require: O A. Amount of payment O B. Timing of payment O C. Credit terms O D. All the answers are correct Moving to another question will save this response.
- Making payments on time is part of (a. payment history b. amount owed c. length of credit history d. new credit e. new mix) portion of a credit score and is (a. 35% b. 30% c. 15% d. 10% ) of the score. Having no late payments makes your credit score go ( a. up b. down ) .4. If you are purchasing it, you are essentially loaning money to the company for a specific period of time.sheet. _is the excess of resources (usually cash) received or paid over the amount of resources 1. loaned or borrowed. 2. is the interest paid on both the principal and the amount of interest accumulated in prior periods. 3. Future value interest factor (FVIF) is represented by the formula 4. An installment that requires a buyer to pay equal payments at a certain period is called. 5. _means that individuals maximize returns for a given level of risk or minimize risk if the returns are the same. 6. The basic decision rule is to accept the project if the net present value is 7. If the cash flow stream lasts forever or is indefinite, then it is called 8. If payment is made and interest is computed at the end of each payment interval, then it is called 9. One way to reduce risk to an acceptable level is through wherein you invest in different types of investments with different risks and returns. 10. If the cash flow happens at the beginning of each period, then it is called.
- Which of the following would not be considered a resource cost of inflation? a. Additional trips to the bank b. Comparison shopping c. Reprinting menus d. Reprinting price tags e. Buyers pay more for what they buyChoose the letter that BEST corresponds with a correct answer. Write in capital letter the answer of your choice. 1. It refers to the rental fee charged by a lender to an individual for the use of money. D. Principal A. Rate C. Interest 2. The amount of money being borrowed or invested is known as C. Interest B. Time A. Rate D. Principal B. Time 3. This kind of interest is calculated only one for the entire time period of loan. A. Loan B. Investment C. Simple Interest D. Compound Interest 4. The first day of a loan is called as A. due B. loan C. loan date D. due date 5. Which of the following is the percent of interest chredon tha maney per year? A. Rate Ust 6. It is the payment or receipt of equal casn amounts pe! peridd 1or u specified amount of time. Just answer 8,9,12ed amount of fime 912 ntest D. Principal C. Contingent Annuity D. General Annuity 7. When the annuity is made at the end of each period, is called A. Annuity B. Ordinary annuity A. Annuity B. Ordinary annuity C.…MULTIPLE CHOICE What is the effect of the following situations on the cost of accounts receivable financing? (A) A more thorough credit check is undertaken. (B) Receivables are sold without recourse. A. (A) Increase; (B) DecreaseB. (A) Decrease; (B) IncreaseC. (A) Decrease; (B) DecreaseD. (A) Increase; (B) IncreaseE. (A) Increase; (B) No effect