Current asset buildup can be financed by:
a. spontaneously generated funds
b. internally generated funds
c. external funds
d. all
d) all
explanation
current assets can be financed by spontaneously generated funds such as inventory and accounts receivable
current assets can also be financed by internal funds such as retained earnings
external funds refer to the loans from the banks and financial institutions
Current asset buildup can be financed by: a. spontaneously generated funds b. internally generated funds c....
All other things being equal, the payment of an internally financed cash dividend is most likely to result in: a) a lower current ratio b) a higher current ratio c) the same current ratio
3. Under what circumstances can internally generated goodwill be recognized? a. When the market value of an entity exceeds b. The brand of an entity is well-respected c. The goodwill results from a contractural right d. The goodwill will result in future economic benefits e. Internally generated goodwill cannot be recognized 4. Which of the following statements is true regarding the revaluation method? a. Revaluations are always recognized in profit and loss b. Upward revaluations can never be recognized in...
. More on the AFN (Additional Funds Needed) equation Fuzzy Button Clothing Company reported sales of $890,000 at the end of last year, but this year, sales are expected to grow by 6%. Fuzzy Button expects to maintain its current profit margin of 23% and dividend payout ratio of 25%. The following information was taken from Fuzzy Button's balance sheet: Total assets: Accounts payable: Notes payable: Accrued abilities: $400,000 $70,000 $35,000 $75,000 Based on the equation, the firm's AFN for...
It was reported that 60% of a particular type of services are financed by private funds, 70% are funded by employers and employees, and 40% are financed by private funds and by the employers and employees. What is the probability that an individual that is randomly accessing such a service will choose a service that is funded by employers and employees but not by private funds? A. 0.30 B. 0.20 C. 0.10 D. 0.50 E. none of the preceding
The maturity matching approach to current asset financing uses long-term funds to finance all permanent asset requirements. TRUE OR FALSE
2. More on the AFN (Additional Funds Needed) equation Blue Elk Manufacturing reported sales of $720,000 at the end of last year; but this year, sales are expected to grow by 9%. Blue Elk expects to maintain its current profit margin of 22% and dividend payout ratio of 30%. The firm's total assets equaled $475,000 and were operated at full capacity. Blue Elk's balance sheet shows the following current liabilities: accounts payable of $75,000, notes payable of $35,000, and accrued...
2. More on the AFN (Additional Funds Needed) equation Blue Elk Manufacturing reported sales of $890,000 at the end of last year; but this year, sales are expected to grow by 6%. Blue Elk expects to maintain its current profit margin of 21% and dividend payout ratio of 25%. The firm's total assets equaled $400,000 and were operated at fll capacity. Blue Elk's balance sheet shows the following current liabilities: accounts payable of $60,000, notes payable of $40,000, and accrued...
Drop-down options: (dollar value), (percentage) 3. More on the AFN (Additional Funds Needed) equation Bohemian Manufacturing Company reported sales of $775,000 at the end of last year, but this year, sales are expected to grow by 6%. Bohemian expects to maintain its current profit margin of 24% and dividend payout ratio of 10%. The following information was taken from Bohemian's balance sheet: $500,000 Total assets: Accounts payable: Notes payable: Accrued liabilities: $70,000 $30,000 $80,000 Based on the AFN equation, the...
3. More on the AFN (Additional Funds Needed) equation Aa Aa E Cold Duck Manufacturing Inc. reported sales of $743,000 at the end of last year, but this year, sales are expected to grow by 7%. Cold Duckexpects to maintain its current profit margin of 22% and dividend payout ratio of 20%. The firm's total assets equaled $475,000 and were operated at full capacity. Cold Duck's balance sheet shows the following current liabilities: accounts payable of $60,000, notes payable of...
3. (Dividends and share repurchases: Basics) All other things being equal, the payment of an internally financed cash dividend is most likely to result in (a) a lower current ratio (b) a higher current ratio (c) the same current ratio