Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Question
Net working capital increases when:
A. a credit customer pays for his or her purchase
B. inventory is sold at cost.
C. fixed assets are purchased for cash
D. inventory is purchased on credit
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- 41. Realization of revenue occurs when a. the item is formally recorded and reported in the financial statements b. noncash resources are converted into cash or rights to cash c. the actual exchange of noncash resources into cash С. d. when a transaction is both realized and realizable 42.A revenue recognition method that recognizes revenue before the time of sale is a. percentage-of-completion b. installment c. cost recovery d. point of sale С.arrow_forwardCredits increase assets and decrease liabilities. decrease assets and increase liabilities. increase both assets and liabilities. decrease both assets and liabilities.arrow_forwardNet working capital increases when inventory is purchased with cash. False or Truearrow_forward
- Which of the following has a different effect on net profit than it does on cashflow? A.Cash sale to customer B.Payment for wages C.Payment for rent D.Depreciation of equipmentarrow_forwardAn advantage that money has over other assets is that it: Answer a. Provides a higher return to the owner b. Is a safer asset to hold during times of inflation c. Increases in value over time d. Has lower transaction costs to use as a means of payment than other assetsarrow_forwardWhich one of the following is a capital structure decision? Group of answer choices Determining the level of accounts receivables. Determining how many shares of stock to issue. Determining how much inventory to keep on hand. Deciding whether or not to purchase a new machine for the production line. Determining how much money should be kept in the checking account.arrow_forward
- Cash flow from operating activities is increased by: a. depreciation and amortization b. a decrease in accounts receivable c. a decrease in inventory d. an increase in accounts payable e. all of thesearrow_forwardRefers to the capital recovery factor O (F/A,i,n) O (P/A,i,n) O (A/F,i,n) O (A/Pi,n)arrow_forwardA financial market helps facilitate the flow of capital from where it is to where it is wanted..... needed expensive.... free available..... needed valued.... wasted Oneeded...... availablearrow_forward
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