Which of the following actions should Paperang Inc. take if it wants to reduce its cash conversion cycle? a. Sell common stock to retire long-term bonds. b. Sell an issue of long-term bonds and use the proceeds to buy back some of its common stock. c. Take steps to reduce the DSO. d. Start paying its bills sooner, which would reduce the average accounts payable but not affect sales. e. Increase average inventory without increasing sales.

Which of the following actions should Paperang Inc. take if it wants to reduce its cash conversion cycle? a. Sell common stock to retire long-term bonds. b. Sell an issue of long-term bonds and use the proceeds to buy back some of its common stock. c. Take steps to reduce the DSO. d. Start paying its bills sooner, which would reduce the average accounts payable but not affect sales. e. Increase average inventory without increasing sales.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 13Q: Coffee Partners decides to close due to the increased competition from the national chains. If after...

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Coffee Partners decides to close due to the increased competition from the national chains. If after liquidating the noncash assets there is not enough cash to cover accounts payable, what happens?
Which of the following actions should Reece Windows take if it wants to reduce its cash conversion cycle? a. Take steps to reduce the DSO. b. Sell an issue of long-term bonds and use the proceeds to buy back some of its common stock. c. Increase average inventory without increasing sales. d. Sell common stock to retire long-term bonds. e. Start paying its bills sooner, which would reduce the average accounts payable but not affect sales.
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Which one of the following statements is correct? A. If a firm decreases its inventory period, its accounts receivable period will also decrease. B. The longer the cash cycle, the more cash a firm typically has available to invest. C. A firm would prefer a negative cash cycle over a positive cash cycle. D. Decreasing the inventory period will also decrease the payables period. E. Both the operating cycle and the cash cycle must be positive values.
Which of the following methods can NOT be used to improve the firm’s cash conversion cycle? Decrease the firm’s inventory conversion cycle. Decrease the firm’s receivables collection period. Decrease the firm’s payables deferral period. Increase the firm’s payables deferral period.
Which of the following decreases the cash holding A.The rising commodity prices increases the value of law material inventoriesby 10% B.A manufacturer decreases production in anticipation of a decrease in demand C.THe frim repurchases its own stocks D.THe corporation has decided to give their customer less time in paying their purchases
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