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3 years ago

A firm’s liquidity level decreases when:_______.

Business

1 answer:

katovenus [111]3 years ago

5 0

Answer:

b) inventory is sold on credit.

Explanation:

Liquidity is defined as the a business to use its current assets to settle it's current liabilities.

This is calculated by using the working capital ratio.

Working capital ratio = Current assets ÷ Current liabilities.

Cash and inventory contribute to a business' liquidity.

When inventory is sold on credit, it does not result in immediate increase in cash as payment is in the future. So there is a reduction in the current asset of the company.

A reduction in the numerator of the working capital ratio results in lower value of the ratio (lower liquidity)

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The interest cost component of NPPBC is the_______________.

san4es73 [151]

Answer: D

Explanation: Interest cost reflects the change in the APBO throughout the period which arise simply from a passage in time.

It is usually equal to the APBO at the start of the period times, the supposed discount rate which is used to regulate present value of future cash outflows currently expected or needed to satisfy the commitment or duty.

7 0

3 years ago

Read 2 more answers

A product sells for $250 per unit, and its variable costs per unit are $181. The fixed costs are $430,000. If the firm wants to

brilliants [131]

Answer:

$6600

Explanation:

Given: Selling price= $250 per unit

Variable cost= $181 per unit.

Fixed cost= $430000.

Expected Profit= $25400.

Let´s assume the number of units sold be "x".

Revenue (R) = $250\times x= \$250x$

Cost of product (C)= $\$ 181\times x+ \$ 430000$

∴ Cost of product (C)= $\$ 181x+ \$ 430000$

Now, finding the number of unit sold.

Forming an equation for profit.

We know, Profit= $Revenue-cost$

⇒ $\$ 25400= 250x- (181x+430000)$

Opening parenthesis.

⇒ $25400= 250x- 181x- 430000$

⇒ $25400= 69x- 430000$

Adding both side by 430000

⇒ $455400= 69x$

Dividing both side by 69

⇒ $x= \frac{455400}{69}$

∴ $x= 6600 units$

Hence, total number of units sold to earn $25400 is 6600 units.

6 0

3 years ago

Company C&A sells 600 bottles of a dietary supplement per week at $100 per bottle. The supplement is ordered from a supplier

Katen [24]

Answer:

A. 300

Explanation:

The computation of the economic order quantity is shown below:

= $\sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}$

where,

Annual demand = 600 bottles × 50 weeks = 30,000 bottles

Carrying cost per bottle = $50 × 40% = $20

And, the ordering cost per order is $30

Now put these values to the above formula

So, the value would equal to

= $\sqrt{\frac{2\times \text{30,000}\times \text{\$30}}{\text{\$20}}}$

= 300 bottles

Hence, option A is correct

3 0

3 years ago

1. Determine whether a $100,000, 3-month T-Bill selling at $97,645 or a 10%, semi-annual coupon bond selling at par has the grea

stiv31 [10]

The 10% semi-annual coupon bond selling at par has the greater effective annual return than the $100,000, 3-month T-Bill selling at $97,645.

<h3>Data and Calculations:</h3>

T-Bill:

Face value of T-Bill = $100,000

Present value of the T-Bill = $97,645

Effective yield rate = 9.65% ($2,355/$97,645 x 100 x 12/3)

Bond:

Face value of bond =$100,000

Interest = 10% semi-annual

Present value of the bond = $104,761.90

Effective yield rate = 9.80%

Thus, the 10% semi-annual coupon bond selling at par has the greater effective annual return than the $100,000, 3-month T-Bill selling at $97,645.

Learn more about Bonds and T-Bills at brainly.com/question/15394251

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3 years ago

The top management of Kryptos Inc., a supplier of office stationery to large IT corporations, is involved in a meeting with its

liubo4ka [24]

Answer:

Jury of Executive Opinion

Explanation:

Jury of Executive Opinion method of sales forecasting employs the views of to management in various section. They are are experienced and have good knowledge of the market factors and are able to predict the expected sales. They are able to forecast sales figures through estimates and previous experiences. All internal and external factors are taken into account. Their judgements are pooled together and averaged in drawing the sales forecast of Kryptos Inc.

8 0

3 years ago

Read 2 more answers