Question

ich of the following 25. Which of the following would be classified as a use of cash? An increase in accounts payable. A decrease in marketable securities A decrease in accounts receivable. An increase in retained earnings An increase in inventories. 20. The projected balance sheet fonecasting method produces accurate results unless which of the follow scale are pres temporary recessheet method inaccurate as the condition(s) is (are) present? Fixed assets are "lumpy." Strong economies of scale are present. Excess capacity exists because of a temporary recession. Answers a, b, and call make the projected balance sheet method inaccurate, Answers a ande make the projected balance sheet method inaccurate, but, as the text ex sumption of increasing economies of scale is built into the projected balance sheet method. 27. Which of the following is a key determinant of operating leverage! Level of debt. b. Physical location of production facilities. Cost of debt. d. Technology Capital structure. 28. Which of the following is a key determinant of financial leverage? Level of debt. Technology C. Labor costs. Amount of fixed assets used by the firm. Variable cost of goods sold. 29. Which of the following is (are) typically part of the cash budget? Payments lag. b. Payment for plant construction. Cumulative cash. All of the above. Only answers a and c above. B0. The financial breakeven point for a firm is defined as the level of_that produces a. sales; EBIT. b. sales: gross profit. C. EPS; sales. gross profit; EBIT. e. EBIT; EPS. equal t

Answer 1

As per HomeworkLib policy, I'm obliged to answer only first complete question. Kindly ask remaining questions in a seperate question.

25) option a. is incorrect because when there is an increase in operating current liability, it is treated is cash inflow rather than cash outflow. Hence, a isn't use of cash.

Option b. is incorrect because decrease is marketable securities means that we have sold some asset and sale of asset would bring more cash rather than its outflow.

Option c. is incorrect because decrease in accounts receivable means that they paid us cash, that's why they have decreased, hence it is cash inflow rather than its use.

Option d. is incorrect because net profit increases retained earnings and net profit is an inflow rather than outflow.

Option e. is correct because increase in inventories means that we have purchased more inventory and hence it required use of cash.

Hence, the correct answer is e. An increase in inventories.