If a firm sold some inventory on credit, its current ratio would probably not change much, but its quick ratio would increase.” If it is possible give reason in two sentences.

Q: What does a high ratio in Creditors Turnover Ratio indicate? a. Company is delaying the payment to…

A: Creditors Turnover Ratio measures how fast a company is paying off its creditors.

Q: or Goods, Inc makes goods that sell better in bad economic times. As a result, when the market is…

A: Beta of stock tells us that risk of stock against the overall risk of stock and how would be…

Q: Which risk ratios best answer each of the following financial questions? a. How quickly is a company…

A: Risk Ratio: This ratio indicates the health of the company. Here health means that the capital…

Q: Which of the following typically is true for profitability ratios? a. Growth stocks have lower price…

A: Profitability ratios are calculated to assess the company's ability to generate incomes relative to…

Q: Profit margins and turnover ratios vary from one industry to another. Whatdifferences would you…

A: Profit margin is a measure of company’s earnings relative to its revenue. In simple terms, it is the…

Q: Which one of the following statements is correct?  A.  If a firm decreases its inventory…

A: Inventory period is based on how much inventory on average you keep on hand and receivable period is…

Q: 1. Procter and Gamble reports a large number of financial metrics  including ratios like Return on…

A: The financial metrics are used for finding out the health and profitability of a company. Each…

Q: What is the minimum probability of collection that should be accepted by firms that have a 25%…

A: Profit margin means amount of net income earned on the sales revenue. 25% profit margin means out of…

Q: 20 The suitable priority of preparing financial statements: a. Balance sheet, then income statement…

A: Question 20: The correct answer is option is B i.e. Income Statement->changes in equity statement…

Q: Arruza Co. is considering switching from the specific-goods LIFO approach to the dollar-value LIFO…

A: a. b. c. d.

Q: . Which of the following costs will tend to increase if a firm switches to a restrictive short-term…

A: Answer: The correct option would be option C (I, III, and IV only). Introduction: Restrictive policy…

Q: Why is the quick ratio frequently a betterindicator than the current ratio of a firm’s ability to…

A: Current Ratio & Quick Ratio are short liquidity ratios. Both Ratios show efficiency of business…

Q: Apple Inc. Amazon Inc. Current Ratio 1.36 1.10 Debt to Equity Ratio 395.70% 262.95% Gross Profit…

A: Ratios are commonly used for quantitative analysis to check the financial performance and viability…

Q: If one firm is growing rapidly and another is not, how might this distort a comparisonof their…

A: It is a financial measure that is used to evaluate as to how many times a company sells or uses its…

Q: Suppose you were comparing a discount merchandiser with a high-end merchandiser.Suppose further that…

A: The profitability of firm can be measured by computing Return on equity (ROE). It determines the…

Q: Which of the following statements about the quality of earnings ratio is true? Multiple Choice…

A: Lets understand the basics. Quality of earning ratio indicates the cashflow from operating activity…

Q: Which of the following is true? O If a firm's volume of credit sales decreases, then its liquidity…

A: Following is the correct option.

Q: Which of the following would increase risk?   a. Raise the level of working capital b. Increase the…

A: The working capital is the funds it needs to carry out day-to-day operations like cash, accounts…

Q: Identify which of the statements below are true (T) or false (F). Lean businesses aim to: Reduce…

A: Lean businesses aim to: Reduce inventory levels--true

Q: Explain how LIFO, FIFO, and Weighted average inventory systems will have different affects on a…

A: FIFO (First in first out) method makes the assumption that inventory items that are purchased first…

Q: 7. Which of the following is true: a. If two companies have the same ROA, the firm with higher debt…

A: Return on assets compares the worth of a company's assets to the profits it generates over a…

Q: In general, it's better to have a low inventory turnover ratio than a high one, as a low ratio…

A: The financial ratios refer to the ratios that are calculated using the financial data from the…

Q: What does a low ratio in Creditors Turnover Ratio indicate? a. Company collects the money fast from…

A: Ratio analysis means where different ratio of various years of years companies has been compared and…

Q: The dollar sales required for the company to break even is closest to:

A:

Q: Debt-deflation leads to lower income because: O falling prices redistribute income from debtors to…

A: Debt deflation is an economic theory. It occurs when fall in prices leads to increase of debt burden…

Q: 6- If a company's EBIT margin is increasing while its net profit margin is decreasing, which of the…

A: First we need to define both terms so that we can answer this question. Earning Before Interest and…

Q: In using the percentage of sales forecasting method, the assumption is that ______________.   a.…

A: The percentage of sales method is used to compute the financing required when there is an increase…

Q: If company A has current ratio of 1.3 while company B has a current ratio of 2.3, which is a better…

A: Current ratio is a ratio which measures the proportion of current assets over current liabilities.…

Q: RRECT THE SENTENCES: Identify the word that makes the sentence incorrect and write down the correct…

A: Gross profit refers to the profit that an organization makes by deducting cost of goods sold from…

Q: Making changes to a firm’s credit policy involves trade-offs. Assuming that all other factors remain…

A: Cash discount means giving discount for the customers who are paying amount immediately or before…

Q: : Suppose you are a financial analyst and you have to explain the following statements: a) If one…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Compared to a company that uses the FIFO method, during periods of rising prices acompany that uses…

A: First in First out method states that the inventory units purchased first or earlier are sold first…

Q: Profit margins and turnover ratios vary from one industry to another. What differences would you…

A: Financial ratio analysis is one of the tools of financial analysis of a firm. It represents the…

Q: A firm that uses LIFO accounting for inventory in times of rising investory costs will always report…

A: FIFO First in first out method is a method of inventory accounting wherein the units of goods…

Q: m wants to increase its working capital efficiency, it should:      Increase its da

A: Introduction: Working Capital is day to day expense requirement of the organization. It is the…

Q: Suppose a company’s current credit terms are 1/10,net 30, but management is considering changingits…

A: The original credit terms were: 1/10, net 30. It means that if a customer pays within 10 days, then…

Q: Explain how a shift in the sales mix could result in both a higher break-even point and a lower…

A: Sales mix involves the composition of different products and some products have a higher margin of…

Q: Th e Industry and Business Risk excerpt states that, “Increased competition may lead tolower unit…

A: If prices are decreased, write downs under FIFO are least probably to have a considerable impact as…