Fundamentals of Corporate Finance Study Set 23

Taylor Supply has made an agreement with its bank that it can borrow up to $10,000 at any time over the next year.This arrangement is called a(n):

Which one of the following increases cash?

Costs that increase as a firm acquires additional current assets are called _____ costs.

Which of the following are uses of cash? I.collecting a receivable II.increasing inventory III.obtaining a bank loan IV.paying a supplier for previous purchases

Which of the following are sources of cash? I.decrease in inventory II.increase in accounts receivable III.repayment of a bond IV.sale of preferred stock

Costs that decrease as a firm acquires additional current assets are called _____ costs.

Which one of the following will increase net working capital? Assume the current ratio is greater than 1.0.

Which of the following will increase the operating cycle? I.increasing the inventory turnover rate II.increasing the payables period III.decreasing the receivable turnover rate IV.decreasing the inventory level

A graphical representation of the operating and cash cycles is called a(n):

The length of time between the purchase of inventory and the receipt of cash from the sale of that inventory is called the:

The length of time between the day a firm purchases an item from its supplier until the day that supplier is paid for that purchase is called the:

Central Supply purchased a toboggan for inventory this morning and paid cash for it.The time period between today and the day Central Supply will receive cash from the sale of this toboggan is called the:

Which one of the following equals the operating cycle?

The length of time between the sale of inventory and the collection of the payment for that sale is called the:

Brustle's Pottery either factors or assigns all of its receivables to other firms.This is known as:

Rose's Gift Shop borrows money on a short-term basis by pledging its inventory as collateral.This is an example of a(n):

Steve has estimated the cash inflows and outflows for his hardware store for next year.The report that he has prepared recapping these cash flows is called a:

Which one of the following will decrease the net working capital of a firm? Assume the current ratio is greater than 1.0.

Money deposited by a borrower with the bank in a low or non-interest-bearing account as a condition of a loan agreement is called a:

The length of time that elapses between the day a firm purchases an inventory item and the day that item sells is called the: