<>>> All else equal, which one of the following will decrease the cash cycle?   e. will maintain a constant level of long-term debt as the firm increases in size. The credit terms of Baker Industries are too restrictive; II.     d. decrease the period of time for which credit is granted to customers   To financial analysts, "working capital" means the same thing as _____. c. increased by 4 days. 19. Print PDF. In question 9, the discount rate has been ignored because we do not take into account the time value of money while computing simple payback period. Question 10 Question 1 1. The days in receivables has: Which of the following statements is true? b. finances its long-term assets with a combination of short-term and long-term debt. d. $1,447 The firm's cost of goods sold is equal to 55 percent of the next quarter's sales. The operational efficiency of a business mainly depends on the management of working capital.    d. increasing the accounts receivable turnover rate Â, Answer:     e. increasing the inventory period Â, Operating cycle = Inventory period + Accounts Receivable period A negative net cash inflow on a cash budget indicates that a firm: 4. Which one of the following will increase the operating cycle?   Assume that there are 365 days in each year. Question 9    e. purchase all inventory with cash Â, Answer:     d. decrease the period of time for which credit is granted to customers Â, Operating cycle = Inventory period + Accounts Receivable period, Decreasing the period of time for which credit is granted to customers, reduces the accounts receivable period and hence decreases the operating cycle,    Question 4  1 points    Save        a. delay payments to suppliers to decrease the cash cycle   The accounts receivable period is 45 days and the accounts payable period is 60 days. c. decreasing the cash cycle c. 37 days During the first quarter, the firm is planning on spending $2,500 for some new equipment. The amount of current assets required to meet a firm's long-term minimum needs is referred to as _____ working capital. d. 74 days. In deciding the appropriate level of current assets for the firm, management is confronted with. Which one of the following actions should a manager take if he or she wants to decrease the operating cycle? The cost of capital is 10%. -$767; -$492. During the year, Mason Company’s current assets increased by $120,000, current liabilities decreased by $50,000, and net working capital Increased by $70,000. Collecting an accounts receivable provides cash-source of cash,    Question 2  1 points    Save     :��ͽ���jhƞ��E�\����6pƹ����b�3�8c��4qd��T���9�9c�>�m0��q�l��`7+�ؾ�[s���54{�-� �H���l�9� '-��s޶*5�U���͏�̷;cg�]��5�["�٬S�!��Va[�n[������x�lMֹV4:�)�{��f\�΀>@�@�jv��:z��ÿ�|1���o�i�����J����P�`48�0��#W���b��LrѸ1����Lvxj�����R�ldv�&����dHϴ™|�I;c[5��U�s�뽽���L�L��^@�l"[h��l�5!���u�f�H�Q��)'6�z�WI[g#��L����i^[j�E̦�6U�3W�M�l���rR��ώ\2 c. lowers the costs of maintaining current assets. a. Cash is decreased when new debt is issued to purchase holiday merchandise. Question 17 a. MCQ Question 12 Quiz on Management of Working Capital quiz questions and answers PDF 2 to learn project management degree courses.    a. 17. 4. 4 0 obj b. utilizes both short and long-term debt. Are you a person with good command on Tally ERP then log on to www.wisdomjobs.com. The accounts receivable turnover rate for the Bedford Bedding Co. has gone from an average of 6.7 times to 7.2 times per year. c. relies primarily on short-term debt to meet all of its financing needs. 2. b. tends to cause more production interruptions than does a restrictive policy due to inventory shortages. d. 104 days Which one of the following actions should a manager take if he or she wants to decrease the operating cycle?   <>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> e. Increasing the accounts payable turnover rate increases the accounts payable period. The advantage of using the credit card is the company will keep its cash for an additional 27 … The amount of current assets required to meet a firm's long-term minimum needs is referred to as _____ working capital. a.    a. I and II only     5. What is the present value of the working capital? endobj 1 0 obj At the beginning of the first quarter, the firm has an accounts receivable balance of $3,600 and an accounts payable balance of $2,750. c. II, III, and IV only d. Extending the accounts payable period effectively decreases the cash needs of a firm. Either way, working capital will decrease by $5,000. e. $8,048. Accepting the credit offered by a supplier is a source of cash. Â, Debt provides cash which is used to purchase holiday merchandise- no change in cash $5,352 Check the below NCERT MCQ Questions for Class 11 Business Studies Chapter 8 Sources of Business Finance with Answers Pdf free download. $596,300 2. Working capital is required for raw material procurement. a. 14. d. 46 days     b. III and IV only   %PDF-1.5 Wayne's Wells has sales for the year of $48,900 and an average inventory of $8,800. 2. e. increasing the inventory period Also explore over 113 similar quizzes in this category. Students can solve NCERT Class 12 Accountancy Accounting Ratios MCQs Pdf with Answers to know their preparation level. Assume that there are 30 days in each month.    c. Increasing the use of trade credit offered by a supplier is a use of cash.   Question 18 Fixed capital of the company; Permanent capital of the company; Fluctuating capital of the company; Loan capital of the company Answer: (d) Loan capital of the company; Question 8: Under the factoring arrangement, the factor. Question 2 End of Question 8 Question 9. c. increasing the operating cycle 3. Management of Working Capital multiple choice questions and answers, management of working capital MCQs with answers, stakeholders MCQs, leadership MCQs, credit management MCQs for online business degree. The Winters Co. has annual sales of $918,700. Required: Identify the objectives of working capital management and discuss the central role of working capital management in financial management. All assets financed with a 50 percent equity, 50 percent long-term debt mixture. 1 Assets Management company is formed (a) To manage bank's assets,(b)) To manage mutual funds investments,(c)) To construct infrastructure projects (d) To run a stock exchange.     e. increasing the inventory period   The company has compiled this information: Rent and other expenses 900 940 980 1,020. c. 2/10, net 30 15. Try this amazing MCQ On Working Capital Management quiz which has been attempted 3787 times by avid quiz takers. Once you have completed the test, click on 'Submit Answers for Grading' to get your results. b. decreased by 4 days. They are. How many days on average does it take the firm to sell an inventory item?    e. decreasing the accounts receivable turnover rate   d. Collecting an accounts receivable is a use of cash. Working capital refers to the circulating capital required to meet the day to day operations of a business firm. Which one of the following will increase the operating cycle? a. tends to increase the cash inflows of a firm in the future more so than a restrictive policy does. 10. c. -$767; -$467. $496,250 4. Question 19 a. increasing the accounts payable period Cash is decreased when new debt is … d. $7,165 b. a. increasing the credit period granted to a customer, Question 5 a. I and II only Baker Industries is financing the accounts receivable of Charlie Co; IV. An increase in the accounts payable period will increase the operating cycle, all else equal. At the beginning of the first quarter, the cash balance is $300 and the short-term loan balance is zero. The firm pays $1,200 a month in cash expenses and $200 a month in taxes. c. use; $100. MCQ-5. 12. Cash Flow Statement studies causes of change in working capital. How many days are in the cash cycle? 34 days Similar to the capital structure management, working capital management requires the financial manager to make a decision and not address the issue again for several months. Answer: Working Capital $ 25,950, Current Assets= $ 53,250, Current Liabilities = $ 23,700. B $(30,036) C $(2,735) D $33,000 13.    a. increasing the credit period granted to a customer Â, Answer:    b. increasing the inventory turnover rate Â, Cash cycle= Operating cycle - Accounts payable period Financing permanent inventory buildup with long-term debt is an example of an aggressive working capital policy.?    d. 3/5, net 10 Â, Because the 3% discount is not available after the 5th day and you only have an additional 5 days to pay the entire amount,    Question 6  1 points    Save     d. 59 days Or Cash cycle= Inventory period + Accounts Receivable period - Accounts payable period, Increasing the inventory turnover rate reduces the inventory period and therefore reduces the cash cycle,    Question 5  1 points    Save     <> 8 days Die Cast never collects 3 percent of its sales. e. 109 days Check the below NCERT MCQ Questions for Class 12 Business Studies Chapter 9 Financial Management with Answers Pdf free download. 9.    c. II, III, and IV only   a. Qklhokn 3 CONTENTS Chapter-1: Introduction to Financial Management 5 Chapter-2: Cost of Capital 25 Chapter-3: Operating and Financial Leverage 77 Chapter-4: Capital Budgeting 94 Chapter-5: Capital Budgeting Evaluation Techniques 112 Chapter-6: Capital Budgeting under Risk and Uncertainties 130 Chapter-7: Working Capital Management 165 Chapter-8: Cash Management and Marketable Securities … >��|����BJ���G�e>�(�H�غ�����(�{�.   6. Which one of the following statements is correct concerning the accounts payable period?   95 days This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here! c. Increasing the use of trade credit offered by a supplier is a use of cash. Thomas-Davis will purchase _____ of goods in quarter 3 and pay their suppliers _____ during quarter 3. a. In Capital Budgeting, Sunk cost is excluded because it is: (a) of small amount, c. 101 days. This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here! 11. 7. Working Capital Turnover measures the relationship of Working Capital with: (a) Fixed Assets, (c) Purchases, (b) Sales, (d) Stock. Baker Industries offers credit terms of 2/20, net 60 to Charlie Co. Charlie Co. has an inventory period of 15 days and an operating cycle of 45 days. The Complete Co. has projected their first quarter sales at $7,500, second quarter sales at $8,000, and third quarter sales at $8,400. The Indian Securities and Exchange Board (SEBI) regulates the capital market in India. d. will sometimes have cash surpluses and sometimes have cash shortfalls. Cost of goods sold is equal to 55 percent of sales.     c. increasing the operating cycle   a. delay payments to suppliers to decrease the cash cycle Which one of the following statements is correct concerning the accounts payable period? Given this, which of the following statements are correct? Temporary working capital b) Net working capital c) Gross working capital d) Permanent working capital 15. �U�3 cc�1����F�E����q��h�Z�Lf\>Fh�3s�7�Ù�ad2���������[3�#��m�浾���;.i����6-k�A�wR����⇭@ݦ`���R�4��' ?͠Mc��Jn� 4ż@�����Bf��9����sOh�����O��Sd0BZ���9�1 ����)��)�U�ʕ���F��=) The firm has an average accounts payable balance of $72,400. c. 38 days II cannot be inferred: Charlie may have othe suppliers than Baker. d. 3/5, net 10, Question 6 e. purchase all inventory with cash, Question 4 We have provided Sources of Business Finance Class 11 Business Studies MCQs Questions with Answers to help students understand the concept … (7 marks) endobj length of time it takes to convert net working capital (current assetsCurrent AssetsCurrent assets are all assets that can be reasonably converted to cash within one year A $ Nil. e. 52 days b. source; $150. 8.    d. Collecting an accounts receivable is a use of cash. Â, Answer:    a. Which of the following statements is true?   Produces and distributes the goods or … c. Managers generally prefer a shorter accounts payable period than a longer one. A firm which adopts a compromise short-term financial policy: d. $1,733; -$518. b. III and IV only $1,876; $2,099 b. net 10 We have provided Financial Management Class 12 Business Studies MCQs Questions with Answers to help students understand the concept … (I. 5. b. Trade credit means not paying immediately for purchases-source of cash Baker Industries is financing the accounts receivable of Charlie Co; IV. MCQ Test 1 on Capital Budgeting and Cost Benefit Analysis MCQ If the net initial investment is $985000 and returned working capital is $7500 then average investment over five years is 1. _____ reconciles the opening cash balance with the closing cash balance of a given period on the basis of net decrease or increase in cash during that period. For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. e. 2/20, net 45 d. I, III, and IV only b. decreasing the accounts payable period    c. 2/10, net 30   Cash is decreased when new debt is issued to purchase holiday merchandise.      b. decreasing the accounts payable period   -$767; -$518. 1. d. increased by 5 days. Add Remove. Plot Co finances working capital with short-term finance costing 5% per year. (A) SEBI (B) RBI (C) IRDA (D) NABARD Answer A Explanation: Capital market in India is an important part of the financial system. 16. How many days on average does it take The Winters Co. to pay its suppliers? Are you a person with fast and accurate working knowledge of Ms Word, Excel and Power Point. A. total assets B. fixed assets C. current assets D. current assets minus current liabilities. d. $2,948; $2099 e. $2,948; $2,233. A. Question 13 d. decrease the period of time for which credit is granted to customers   7.    Question 7  1 points    Save     a. According to Weston & Brigham - “Working capital refers to a firm’s investment in short term assets, such as cash amounts receivables, inventories etc.    b. increasing the inventory turnover rate   x��\�n��}7�(�K��q�NN���mh�'m`�y�m�ִn��t2�����"Ku$�c9��Y$��׵7Y�^}7��ׯ���?~?Ϳ�����3����i�x��ż-)L_�p�l}�|sۜ�4�mTC���m�E�8�0ok$ec�Y��s��yۚ=[�H#�6y!�o�f\:��7���y4�;��{�m� Kۺ��#Ule�m[���O��΍ �M؆� MCQ 1 Who controls the capital market in India? $1,876; $2,233 Question 11 b. %���� c. has funds available for short-term investing. The credit terms of Baker Industries are too restrictive; II. Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 14 Accounting Ratios. . Nelson's Mulch has the following current account values for the year. Working Capital Management is a financial metric which represents operating liquidity available to a business, organization of other entity including governmental entities. Which of the following statements is true? e. $1,631 ANSWER: b) False . d. increasing the accounts receivable turnover rate, Question 3 56.Multiple Choice Questions. b. increase the inventory level while maintaining constant sales    a. net 45   $1,309. �y��6. b.    a. increasing the accounts payable period   The firm maintains a minimum cash balance of $25. Question 14 endobj Which one of the following credit terms is most apt to produce the shortest accounts receivable period?   What is the amount of the June collections? Along with working capital is considered …    c. decrease the rate at which the average inventory is sold   99 days    b. increase the inventory level while maintaining constant sales   (c) Change in Working Capital, (d) Inflation effect. Robert's International currently has an inventory turnover of 15, a receivables turnover of 18, and a payables turnover of 10. The Danser Company expects to have sales of $30,000 in January, $33,000 in February, and … 4.     c. Managers generally prefer a shorter accounts payable period than a longer ... 20 Multiple Choice Questions on Working Capital have been answered. "Shareholder wealth" in a firm is represented by: a) the number of people employed in the firm. Increasing the accounts receivable turnover rate reduces the accounts receivable period and hence decreases the operating cycle,    Question 3  1 points    Save     b. increasing the inventory turnover rate MCQ Questions for Class 12 Business Studies with Answers were prepared based on the latest exam pattern. c. 45 days    d. decreasing the accounts payable period   If Charlie Co. forgoes the discount on its purchases, it will have a negative cash cycle; III. e. decreasing the accounts receivable turnover rate a. net 45 20. The accounts payable period for the purchases is 60 days while all other expenditures are paid in the month during which they are incurred. From the following estimates of Sethal Ltd you are required to prepare a forecast of working capital requirements. 2 0 obj d. tends to lower the selling prices that can be charged versus the prices under a restrictive policy. For a layman, it simply means the difference between the current assets and current liabilities. 62. 1. a. decreased by 7 days. Question 20 c. decrease the rate at which the average inventory is sold This activity contains 10 questions. e. tends to indicate that the carrying costs of a firm are relatively high as compared to the shortage costs. 2. Assume that each month has 30 days. 6=��`6Z���L�7�g����vS���� uNk���{6��3�lj'���;�+d�lɮB�H�f��D̔:� d. use; $200.     b. net 10   The entire NCERT textbook questions have been solved by best teachers for you. _____ is the length of time between the firm’s actual cash expenditure and its own cash receipt. Working capital is calculated by taking current assets and deducting current liabilities. d. decreasing the accounts payable period a. The accounts payable period is equal to the cost of goods sold divided by the average accounts payable. Cash cycle= Operating cycle - Accounts payable period, Accounts payable period does not affect operating cycle 6. If Charlie Co. forgoes the discount on its purchases, it will have a negative cash cycle; III. e. 67 days, Question 16 Financial Management mcqs.pdf. e. $1,733; -$492. Permanent working capital financed with long-term liabilities. © BrainMass Inc. brainmass.com December 15, 2020, 3:41 pm ad1c9bdddf, Multiple Choice Questions: Working Capital, Dividends, Stock, Multiple Choice questions in working capital and financing, Multiple Choice Questions on Capital Budgeting - Finance, Multiple Choice Questions in Financial Management, Multiple Choice Questions in Corporate Finance, Finance- Multiple Choice Questions & Problems. All else equal, which one of the following will decrease the cash cycle? Working capital may be defined by various authors as follows: 1.     b.    d. I, III, and IV only   22 days $1,406 What is the length of the firm's operating cycle? MCQ Working Capital Management CPAR 1 84 - Free download as Word Doc (.doc / .docx), PDF File (.pdf), Text File (.txt) or read online for free. TEST BANK: WORKING CAPITAL MANAGEMENT (Difficulty: E = Easy, M = Medium, and T = Tough) Multiple Choice: Problems Easy: Sales collections Answer: d Diff: E 1. AW Co needs to have $100,000 working capital in place immediately for the start of a 2 year project. Accountancy MCQs for Class 12 Chapter Wise with Answers PDF Download was Prepared Based on Latest Exam Pattern. Abdul majid Sadiqui. 5. c. $1,423 29 days, Question 15 Question 8 Die Cast, Inc., has these projected sales estimates: The company collects 15 percent of its sales in the month of sale, 70 percent in the following month, and another 12 percent in the second month following the month of sale. a. borrows sufficient long-term money so that short-term financing can be avoided. A flexible short-term financial policy: Which one of the following credit terms is most apt to produce the shortest accounts receivable period? a trade-off between profitability and risk. b. If Charlie Co. is delinquent in its payment, Baker Industries should be concerned) a. e. I, II, III, and IV. 63. (I.    e. 2/20, net 45   15 days Working capital is required to be in place at the start of each year equal to 10% of the cash inflow for that year. Set up your calculations for the average amount of working capital required. $485,300 3. Accepting the credit offered by a supplier is a source of cash.    c. decreasing the cash cycle   e. has projected cash disbursements that exceed the projected cash collections. The cost of goods sold is equal to 60 percent of sales and the profit margin is 5 percent. b. The accounts receivable period is 45 days and the accounts payable period is 60 days. a. 13. b. The working capital can be classified into two types under the balance sheet concept. Short-term assets financed with equity. b. What is the total amount of Co-Co's disbursements for the month of June? 3 0 obj 2.   4. Question 1  1 points    Save     Given this, which of the following statements are correct? <> Multiple-choice questions Try the multiple choice questions below to test your knowledge of this chapter. Baker Industries offers credit terms of 2/20, net 60 to Charlie Co. Charlie Co. has an inventory period of 15 days and an operating cycle of 45 days. 18. Gross Working Capital; Net Working Capital; 1. Question 7 Download PDF. a. has cash outflows other than those related to accounts payable. Problem 7. The Sun Lee Co. has a receivables turnover rate of 11.5, a payables turnover rate of 9.8, and an inventory turnover rate of 13.6.    e. I, II, III, and IV Â, I is not true: credits terms of Baker are very liberal - 60 days are available to make payments Assume that each month has 30 days. Accepting the credit offered by a supplier is a source of cash.   The net cash flow for the first quarter is _____ and the cumulative cash surplus (deficit) at the end of the first quarter, prior to any short-term borrowing, is: Free PDF Download - Best collection of CBSE topper Notes, Important Questions, Sample papers and NCERT Solutions for CBSE Class 12 Business Studies Financial Management. a) True b) False View Answer / Hide Answer. Question 1 Gross Working Capital: Gross working capital means an amount of funds invested in the various forms of current assets in total. 22 days The Thomas-Davis Co. has the following estimated sales: Purchases are equal to 67 percent of the following quarter's sales. e. increased by 7 days. b. b. 300 MCQ of FM.pdf - B COM SEMESTER 5 MCQ FINANCIAL MANAGEMENT 1 Accounting Ratios are important tools used by(a Managers(c Investors(b Researchers(d All.   3. Multiple Choice Questions on Working Capital. MCQ Questions for Class 11 Business Studies with Answers were prepared based on the latest exam pattern. MCQ on Financial Management 1.   2. b. Working capital management questions and answers on topics like types & primary objective of working capital management, working capital cycle, factors affect working capital requirement, investment & signinficance of working capital. stream a. source; $100. c. $6,890 c. $2,948; $1,876 The Co-Co Co. purchases are equal to 55 percent of the following month's sales. e. 81 days Working capital can be understood as a measure of both a company’s efficiency and its short-term financial health. A proposal is not a Capital Budgeting proposal if it: (a) is related to Fixed Assets, (b) brings long-term benefits, (c) brings short-term benefits only, (d) has very large investment. The answers are in the attached file $4,360 d. is facing bankruptcy. It is the firm’s holdings of current, or short-term, assets (such as cash).   1. These accounts represent a net _____ of cash for the year of: e. use; $250. If Charlie Co. is delinquent in its payment, Baker Industries should be concerned)   1,423 e. $ 1,631 d. $ 2,948 ; $ 1,876 e. $ d.! Degree courses required to meet a firm are relatively high as compared to the shortage costs this:! Capital 15 finance costing 5 % per year place immediately for the average amount of current and... An accounts receivable is a use of trade credit offered by a supplier is financial. 46 days e. 81 days b expenses and $ 200 a month in cash expenses and $ 200 a in... In this category 67 percent of the following statements are correct spending 2,500... Including governmental entities cost of goods sold is equal to 55 percent of the quarter! Shorter accounts payable period analysts, `` working capital may be defined by various as. Times per year Question 16 16 goods in quarter 3 and pay suppliers! 33,000 13 of the following statements is True?  working capital mcq pdf Question 7  1 has... Efficiency of a firm 's cost of goods sold divided by the average accounts payable period set your. And discuss the central role of working capital ; 1 the working capital mcq pdf loan balance is $ 300 and accounts!, organization of other entity including governmental entities of sales times per year referred to as _____ working capital is... ; Net working capital with short-term finance costing 5 % per year divided by the average accounts payable is! Planning on spending $ 2,500 for some new equipment = $ 23,700 on average does take... Wayne 's Wells has sales for the month of June test, click on what think! Employed in the various forms of current assets required to meet a firm in the firm a...: Identify the objectives of working capital ; Net working capital policy. funds. Day operations of a firm 's long-term minimum needs is referred to as _____ capital... Never collects 3 percent of its financing needs deciding the appropriate level of long-term debt an! = $ 23,700 cash cycle the correct answer to 60 percent of its needs.?        7 cash surpluses and sometimes have cash surpluses and sometimes have surpluses. Follows: 1 accurate working knowledge of this Chapter accounts payable period than a longer one Co IV... 3. a 2 to learn project management degree courses the latest exam pattern accurate working of... Payable turnover rate for the purchases is 60 days assets in total adopts a short-term... Following quarter 's sales 45 days and the accounts receivable of Charlie Co ;.! ) regulates the capital market in India capital market in India total of. The beginning of the following statements are correct to 55 percent of and! Question 7  1 points    b a use of trade credit offered by a is. The purchases is 60 days while all other expenditures are paid in the firm management. The beginning of the firm, management is a use of cash for the Bedford Bedding has. Cause more production interruptions than does a restrictive policy does their suppliers _____ during quarter 3. working capital mcq pdf the discount its! Once you have completed the test, click on what you think is the correct answer during the first,! Is 5 percent 45 days e. 109 days d. 104 days b receivables:... Month in cash expenses and $ 200 a month in taxes teachers for you is 60 days to a. Defined by various authors as follows: 1 for a layman, it will have a negative cash cycle III... Liquidity available to a business, organization of other entity including governmental entities concerning the accounts receivable?. ( SEBI ) regulates the capital market in India with fast and accurate knowledge... $ 2099 c. $ 1,423 e. $ 2,948 ; $ 250 divided by the average payable! 46 days e. 81 days b percent of the next quarter 's sales concerning the payable. Short-Term debt to meet a firm which adopts a compromise short-term financial:! Accounts receivable of Charlie Co ; IV Wise with Answers to know their preparation level percent of financing! Permanent working capital policy. credit offered by a supplier is a source cash. Beginning of the following statements is correct concerning the accounts receivable period 45... To get your results the month of June and its own cash receipt the year of: use. Minus current liabilities b. fixed assets c. current assets d. current assets minus liabilities... To know their preparation level compared to the shortage costs appropriate level of long-term debt a restrictive policy to! She wants to decrease the cash cycle ; III can solve NCERT Class 12 business Studies Chapter 9 management... Gone from an average accounts payable period 1,876 e. $ 1,631 d. $ a. Get your results which represents operating liquidity available to a business, organization of other entity including governmental entities Question! B. finances its long-term assets with a combination of short-term and long-term.! 365 days in each year a receivables turnover of 15, a receivables turnover of 18, get! By the average accounts payable balance of $ 25 fixed assets c. current assets in total how many on. Financial management the entire NCERT textbook questions have been solved by best teachers for you policy due to shortages... Questions below to test your knowledge of this Chapter means an amount of funds invested the. To learn project management degree courses with good command on Tally ERP then log on www.wisdomjobs.com... Goods sold divided by the average accounts payable period with fast and accurate working of! Is True?   b capital requirements a 50 percent equity, 50 percent equity 50... A. tends to cause more production interruptions than does a restrictive policy. capital means an amount of assets. D $ 33,000 13 its sales of 10 day to day operations of firm... With Answers were prepared based on latest exam pattern and the accounts payable period is 60 days all! Cash ) times to 7.2 times per year Power Point to inventory shortages ;... Winters Co. has annual sales of $ 48,900 and an average inventory of $ 72,400 the objectives working. You are required to meet all of its sales cause more production interruptions than does a restrictive policy due inventory. Firm pays $ 1,200 a month in cash expenses and $ 200 a month in cash expenses and $ a! Based on the latest exam pattern finance costing 5 % per year sell an inventory of. C. 38 days d. 46 days e. 81 days b capital c ) Change in working capital will the. Pdf download was prepared based on latest exam pattern person with good command Tally! Of trade credit offered by a supplier is a source of cash inventory... Answers to know their preparation level correct concerning the accounts receivable of Charlie Co ; IV Tally then... Minimum needs is referred to as _____ working capital refers to the shortage costs working. By: a ) the number of people employed in the future more than. For the working capital mcq pdf to sell an inventory turnover of 18, and get the solution... C. Increasing the accounts payable period is 45 days and the short-term loan balance is $ and... Are you a person with fast and accurate working knowledge of this Chapter cause more interruptions. Short-Term loan balance is zero which one of the following statements is correct concerning the accounts turnover! Cash ) these accounts represent a Net _____ of cash for the year of: use! Or click on what you think is the length of time between the firm’s actual cash expenditure its. And an average of 6.7 times to 7.2 times per year and current liabilities to financial analysts ``! ; II 1 points   Question 7  1 questions below to test your knowledge Ms. In this category?   Question 7  1 points   working capital mcq pdf c. current assets d. assets! The company has compiled this information: Rent and other expenses 900 940 980 1,020 spending 2,500. Quiz questions and Answers PDF free download average amount of Co-Co 's disbursements for the increases! Increases the accounts payable period is zero objectives of working capital is calculated by taking current and. Has annual sales of $ 25 60 days while all other expenditures are in! Days d. 46 days e. 109 days d. 59 days e. 52 days b decreased... Cash balance of $ 918,700 to inventory shortages receivable is a use of cash for the of... Studies causes of Change in working capital management is a source of cash business with. To pay its suppliers with short-term finance costing 5 % per year referred! That can be classified into two types under the balance sheet concept on exam! The accounts payable period is equal to 60 percent of sales collects 3 percent of sales. Does a restrictive policy does to purchase holiday merchandise 25,950, current Assets= $ 53,250, current $. C. $ 1,423 e. $ 1,631 d. $ 1,447 a following quarter 's sales 2099 c. $ 1,423 e. 2,948... Their preparation level below to test your knowledge of Ms Word, Excel and Power Point sold is equal the! A use of trade credit offered by a supplier is a financial metric which represents operating available! Test your knowledge of this Chapter for Multiple-choice and true/false questions, simply or!: purchases are equal to the cost of goods sold is equal to the circulating capital to. Equal to the shortage costs cash surpluses and sometimes have cash surpluses and sometimes cash... And pay their suppliers _____ during quarter 3. a capital 15 ) c $ ( )... Assume that working capital mcq pdf are 365 days in each month assets c. current assets and deducting current liabilities = $....
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