Direction: Read the statements carefully. Write TRUE if the statement is correct. Otherwise,write FALSE.1. The sum of the time taken from the payment for the purchase of the raw materialinventories to the receipt of cash from customers is known as the accounts receivable cycle.2. It is wise to offer unlimited credit to any potential customer who seeks it to have moresales.3. One way to establish effective administration of receivables is to systematically reviewthem and that slow payers are sent reminders.4. An objective of working capital management is to maximize the length of the operatingcash cycle.5. Low inventories imply more frequent ordering.6. The Economic Order Quantity model is designed to determine how much totalinventory a firm needs in a year._7. Control of working capital through the use of detailed plans in the form of budgets canbe very beneficial.8. One of the 5Cs of Credit is character. It refers to the customer's willingness to meetcredit obligations.9. The ABC approach to inventory management is based on the concept that theinventory period should be constant for all inventory items._10. At the economic order quantity size, the total costs equal the carrying costs.

Because you have asked question with multiple parts (MULTI PART) , we will solve the first 3 parts…

Answered: Direction: Read the statements…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter10: Cash Receipts And Cash Payments

Section: Chapter Questions

Problem 5QY

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