Homework Answers
Liquidity means ability to convert assets into cash. It means how fast a company can convert his assets or cash equivalent investment , Account receivable Etc.,
Cash is the most liquid assets for any organization.
So liquidity means convert the current assets into cash quickly.
Answer = Option 2 = convert Current assets into cash quickly.
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Liquidity can be best referred to as the ability of the firm to Multiple Choice purchase...
Temporary current assets are those assets that are Multiple Choice Capital assets. Semi-permanent. Self-liquidating Permanent assets...
Temporary current assets are those assets that are Multiple Choice Capital assets. Semi-permanent. Self-liquidating Permanent assets When retained earnings are not sufficient to cover the need for investment in current assets, firms seek to use all of the following methods except: Multiple Choice trade credit bank loans short-term securities. selling off inventories We were unable to transcribe this imageUsually yield curves arebut during peak periods of economic expansion yield curves may be Multiple Choice upward sloping, downward sloping downward sloping:...
1. Which of the following BEST describes a company's proper liquidity management? Multiple Choice Liquitity management...
1. Which of the following BEST describes a company's proper liquidity management? Multiple Choice Liquitity management is a balancing act; managers try to find liquidity levels that are neither too high not too low. A Financial Manager will try to keep as much cash on the books as possible to maximize short-term earnings. A company should never keep cash in its account because bond coupon payments can be deferred for up to a year without penalty. Liquidity levels that are...
Multiple Choice There is no condition known to date whereby a corporation can increase firm value...
Multiple Choice There is no condition known to date whereby a corporation can increase firm value through the use of leverage. o Corporations generally pay a lower cost on debt than do individuals due to their vast pool of liquid assets. o O If individual's pay a higher cost to borrow than corporations do, then corporations can increase firm value by borrowing. o Margin accounts tend to be high interest rate sources of funds for individuals. o o Corporations can...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies s...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies should maintain the highest current ratio possible. Higher current ratios suggest greater liquidity. Companies should maintain the lowest current ratio possible. Which of the following would not likely appear on a classified balance sheet? Multiple Choice Current assets Long-term liabilities Current retained earnings Long-term assets
P 6-24 Required Answer the following multiple-choice questions: a. A company's current ratio is 2.2 to...
P 6-24 Required Answer the following multiple-choice questions: a. A company's current ratio is 2.2 to 1 and quick (acid-test) ratio is 1.0 to 1 at the beginning of the year. At the end of the year, the company has a current ratio of 2.5 to 1 and a quick ratio of 0.8 to 1. Which of the following could help explain the divergence in the ratios from the beginning to the end of the year? (continued R6-Liquidity of Short...
Homemade leverage is: Multiple Choice 0 the borrowing or lending of money by individual shareholders as...
Homemade leverage is: Multiple Choice 0 the borrowing or lending of money by individual shareholders as a means of adjusting their level of financial leverage. O the term used to describe the capital structure of a levered firm. 0 O the incurrence of debt by a corporation in order to pay dividends to shareholders. 0 best defined as an increase in a firm's debt-equity ratio. 0 the exclusive use of debt to fund a corporate expansion project.
Need help with the following Multiple choice questions . please help me with 7 , 8...
Need help with the following Multiple choice questions .
please help me with
7 , 8 , 9 , 12 , 19 , 20 , 22 , 23 & 25
We were unable to transcribe this image11. What is the Degree of Combined Leverage (DCL) of a firm with a Degree of Operating Leverage (DOL) of 1.4, and Degree of Financial Leverage (DFL) of 1.2? It is: a. 2.6 b. 1.25 C. 1.68 d. 0.6 e. None of the above....
Liquidity ratios
1. Liquidity ratiosA liquid asset can be converted quickly to cash with little sacrifice in its value.Which of the following asset classes is generally considered to be the least liquid?Accounts receivableInventoriesCashPoints:1 / 1Close ExplanationExplanation:In the event of a liquidation, inventories tend to recover the least amount of their stated value. Cash will not lose value, and accounts receivable are likely to retain their value if there are no bad debts. That is why the quick ratio adjusts current assets by...
PROJECT: Select any bank / firm of your choice. Take out its financial statements. Calculate the...
PROJECT:
Select any bank / firm of your choice. Take out its financial
statements.
Calculate the following ratios according to the information
found in these statements.
(NOTE: Show your workings)
1. Operating Cycle. Inventory Number of days of inventory - Average day's cost of goods sold Inventory cost of goods sold / 305 Number of days of receivables = Accounts receivable Average day's sales on credit Accounts receivable Sales on credit / 365 Number of days of payables - Accounts...
PROJECT: Select any bank / firm of your choice. Take out its financial statements. Calculate the...
PROJECT:
Select any bank / firm of your choice. Take out its financial
statements.
Calculate the following ratios according to the information
found in these statements.
(NOTE: Show your workings)
1. Operating Cycle. Inventory Number of days of inventory - Average day's cost of goods sold Inventory cost of goods sold / 305 Number of days of receivables = Accounts receivable Average day's sales on credit Accounts receivable Sales on credit / 365 Number of days of payables - Accounts...
Temporary current assets are those assets that are Multiple Choice Capital assets. Semi-permanent. Self-liquidating Permanent assets When retained earnings are not sufficient to cover the need for investment in current assets, firms seek to use all of the following methods except: Multiple Choice trade credit bank loans short-term securities. selling off inventories We were unable to transcribe this imageUsually yield curves arebut during peak periods of economic expansion yield curves may be Multiple Choice upward sloping, downward sloping downward sloping:...
Multiple Choice There is no condition known to date whereby a corporation can increase firm value through the use of leverage. o Corporations generally pay a lower cost on debt than do individuals due to their vast pool of liquid assets. o O If individual's pay a higher cost to borrow than corporations do, then corporations can increase firm value by borrowing. o Margin accounts tend to be high interest rate sources of funds for individuals. o o Corporations can...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies should maintain the highest current ratio possible. Higher current ratios suggest greater liquidity. Companies should maintain the lowest current ratio possible. Which of the following would not likely appear on a classified balance sheet? Multiple Choice Current assets Long-term liabilities Current retained earnings Long-term assets
P 6-24 Required Answer the following multiple-choice questions: a. A company's current ratio is 2.2 to 1 and quick (acid-test) ratio is 1.0 to 1 at the beginning of the year. At the end of the year, the company has a current ratio of 2.5 to 1 and a quick ratio of 0.8 to 1. Which of the following could help explain the divergence in the ratios from the beginning to the end of the year? (continued R6-Liquidity of Short...
Homemade leverage is: Multiple Choice 0 the borrowing or lending of money by individual shareholders as a means of adjusting their level of financial leverage. O the term used to describe the capital structure of a levered firm. 0 O the incurrence of debt by a corporation in order to pay dividends to shareholders. 0 best defined as an increase in a firm's debt-equity ratio. 0 the exclusive use of debt to fund a corporate expansion project.
Need help with the following Multiple choice questions .
please help me with
7 , 8 , 9 , 12 , 19 , 20 , 22 , 23 & 25
We were unable to transcribe this image11. What is the Degree of Combined Leverage (DCL) of a firm with a Degree of Operating Leverage (DOL) of 1.4, and Degree of Financial Leverage (DFL) of 1.2? It is: a. 2.6 b. 1.25 C. 1.68 d. 0.6 e. None of the above....
PROJECT:
Select any bank / firm of your choice. Take out its financial
statements.
Calculate the following ratios according to the information
found in these statements.
(NOTE: Show your workings)
1. Operating Cycle. Inventory Number of days of inventory - Average day's cost of goods sold Inventory cost of goods sold / 305 Number of days of receivables = Accounts receivable Average day's sales on credit Accounts receivable Sales on credit / 365 Number of days of payables - Accounts...
PROJECT:
Select any bank / firm of your choice. Take out its financial
statements.
Calculate the following ratios according to the information
found in these statements.
(NOTE: Show your workings)
1. Operating Cycle. Inventory Number of days of inventory - Average day's cost of goods sold Inventory cost of goods sold / 305 Number of days of receivables = Accounts receivable Average day's sales on credit Accounts receivable Sales on credit / 365 Number of days of payables - Accounts...
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