Business cycles vary in the time between recessions but not in the length of recessions. vary in the length of recessions but not the time in between recessions. are by definition recurring waves that rise and fall in a periodic and predictable pattern. vary in both the length of recessions and the time between recessions.

Business cycles vary in the time between recessions but not in the length of recessions. vary in the length of recessions but not the time in between recessions. are by definition recurring waves that rise and fall in a periodic and predictable pattern. vary in both the length of recessions and the time between recessions.

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter7: Credit Cards And Consumer Loans

Section: Chapter Questions

Problem 4LTAI

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Consider each of the following situations independently of each other. For each of the situations provide one example of when the underlying circumstances may be such that the observed trend is unfavorable and one example of when the underlying circumstances are favorable. a. Current ratio increases from one period to the next b. Accounts receivable turnover increases from one period to the next c. Accounts payable turnover increases from one period to the next
COMPARISON What is the general trend of the company’s current liabilities? Did you observe any account with significant fluctuations? What could be the reason for this? What is the general trend of the company’s noncurrent liabilities? Did you observe any account with significant fluctuations? What could be the reason for this? What is the general trend of the company’s equity? Did you observe any account with significant fluctuations? What could be the reason for this?
Define the term recession?
Periods in time that experience increasing price levels are known as periods of a. deflation b. recession c. inflation d. depression
Accounting for liabilities involves recording and managing obligations a company owes to external parties. Liabilities are classified based on their nature and timing of settlement. Common types include: Current Liabilities: Debts or obligations expected to be settled within one year or the operating cycle, whichever is longer. Examples include accounts payable, accrued expenses, and short-term loans. Long-Term Liabilities: Obligations not due within the next operating cycle or one year. Examples include long-term loans, bonds payable, and lease obligations. Contingent Liabilities: Potential obligations that depend on a future event, such as lawsuits or warranties. They are disclosed in the footnotes of financial statements unless the likelihood of payment is remote. Deferred Revenue: Payments received in advance for goods or services to be provided in the future. They are recorded as liabilities until the revenue recognition criteria are met. Accrued Liabilities: Expenses…
rach phase of the business cycle has certain characteristics. During peak or prosperity, businesses expand end employment is high. Creditors lend money freely; wages, consumer spending, and prices rise. Contraction begins when production begins to slow some because most people who want a good have aiready purchased the good. As the business cycle moves downward a recession might occur. During a recession, businesses readjust to reduced demand, unemployment rises, consumer spending and prices fall, and creditors restrict loans. If the recession continues or worsens, it becomes a depression. The lowest point of a depression is called a trough. Eventually, technology, government programs, international developments, or low depression prices cause an increase in demand. As business adjusts and begins to expand again, the cycle moves upward through a recovery or expansion phase-back to peak or prosperity. Identify the phase of the business cycle described in each statement below. Band "1.…
Define earnings persistence. How does earnings persistence relate to the reporting of discontinued operations?
Which of the following is most likely to refl ect conservative accounting choices?A . Decreased reported earnings in later periodsB . Increased reported earnings in the current periodC . Increased debt reported on the balance sheet at the end of the current period
1. What is the general trend of the company’s current assets? Did you observe any account with significantfluctuations? What could be the reason for this?2. What is the general trend of the company’s noncurrent assets? Did you observe any account withsignificant fluctuations? What could be the reason for this?3. What is the general trend of the company’s current liabilities? Did you observe any account withsignificant fluctuations? What could be the reason for this?4. What is the general trend of the company’s noncurrent liabilities? Did you observe any account withsignificant fluctuations? What could be the reason for this?5. What is the general trend of the company’s equity? Did you observe any account with significantfluctuations? What could be the reason for this?
How does inflation distort ratio analysis comparisons for one company over time (trend analysis) and for different companies that are being compared? Are only balance sheet items or both balance sheet and income statement items affected?
In a classified balance sheet, liabilities are separated into two categories based on a. The amount of the obligation to be satisfied—large versus small. b. To whom the obligation is owed—those inside versus those outside of the company. c. The nature of the obligation—determinable amount versus estimated amount. d. The length of time until the obligation is expected to be satisfied—less than one year versus more than one year.
Classify the following events as mostly systematic or mostly unsystematic. Is the distinction clear inevery case? Provide detailed explanation. a. Short-term interest rates increase unexpectedly.b. The interest rate a company pays on its short-term debt borrowing is increased by its bank.c. Oil prices unexpectedly decline.d. A manufacturer loses a multimillion-dollar product liability suit.