[Solved] If an Invoice Lists the Terms 2/10 Net 30, It

Financial managers should focus solely on meeting the financial needs of their firms in the short run, leaving the long-term financial issues to the top management.

The current ratio is calculated by dividing the firm's current liabilities by its total assets.

The debt-to-asset ratio compares a firm's total liabilities to its total assets and is a way of measuring the degree of financial leverage.

The budgeted income statement is a projected financial statement that forecasts the types and amounts of assets a firm will need to implement its future plans and how the firm will finance those assets.

Cash budgets normally cover a five-year period and show projected cash inflows and outflows for each week.

Benny-Duke Inc.reported a net income of $7 million but paid no dividends to its shareholders. The shareholders should sue the company for failure to provide a return on their equity investment.

A disadvantage of debt financing is that creditors often impose covenants on the borrower.

Cash equivalents are long-term, unsecured but highly liquid assets that firms list in the fixed assets section on their balance sheet.

The following questions must be answered when setting credit terms: How long should the firm extend credit? What type of cash discount should the firm offer to encourage early payments?

Projects with the potential for high returns generally have a low degree of uncertainty and risk.