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Dmitriy789 [7]
3 years ago
14

At the extreme, a firm that adheres to the conservative approach to finance current assets will finance all of its seasonal need

s with long-term financing alternatives, thereby eliminating the need to use short-term financing. Such a firm will have extra permanent funds during off-peak periods, allowing it to store liquidity in the form of short-term investments during the off-season.a) trueb) false
Business
1 answer:
Cloud [144]3 years ago
4 0

Answer:

The correct answer is A) True

Explanation:

Seasonal needs are short-term in nature. To service them using short-term funds would prove more expensive over the long run.

Long-term finance in most cases have the characteristics of being relatively cheaper than short-term finance.

Chief among the sources of short-term finance are:

  • trade credits,
  • Commercial Bank overdrafts
  • Commercial paper, promissory note, and
  • loans that are secured

Short-term finances are usually less than a year. Whilst long-term finances generally span over one year.

Examples of long term finances are:

  • Equity Capital
  • government debt
  • Bonds
  • Mortgages etc

Interest payable on long term debts are usually single-digit whilst those on short term loans are usually double-digit.

As indicated in the information provided, companies that keep extra "permanent" funds preserve its value by placing it in short term investments

Cheers!

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Which of the following defines an organization?
malfutka [58]

Answer:

c. A group of people who work together to achieve some specific purpose

Explanation:

An organization is defined as a group of people, a social system that organize and manage themselves by assigning roles and responsibilities in order to achieve an objective.

I hope you find this information useful and interesting! Good luck!

4 0
3 years ago
As an adjustment to operating expenses per the income statement, an increase in accrued liabilities would be added to operating
timofeeve [1]

Answer:

This is a true or false type of question as shown in the attached document.

The correct answer is false

Explanation:

The question was whether the statement on the treatment of increase in accrued liabilities as highlighted in the question is true or false.

In determining the cash payments for operating expenses , increase in accrued liabilities is deducted not added to operating expenses.

This is a case of single entry accounting system where the business does not operate based on the principle of double entry,instead transactions are recorded one-sided.

The justification is that the increase in accrued liabilities is a portion of the current period expenses not yet paid for,as a result,it would be necessary to deduct it from total expenses in order to ascertain the  remaining portion of the expenses already settled with cash.

Download xlsx
5 0
3 years ago
Wichita Industries' sales are 20% cash and 80% on credit. Credit sales are collected as follows: 40% in the month of sale, 50% i
Lina20 [59]

Answer:

The correct answer is E that is $74,520

Explanation:

The expected cash receipts for January from the current and past sales is computed as:

Cash sales for January = Budgeted sales × 20% cash collected

= $51,000 × 20%

= $10,200

Credit Sales is computed as:

For November is $13,000

For December = December Sales / 60 × 50

= $42,000 / 60 × 50

= $35,000

For January = Budgeted Sales × 80 %× 40%

= $51,000 × 80% × 40%

= $16,320

Total January Sales = Cash Sales + Credit Sales

= $10,200 + $13,000 + $35,000 + $16,320

= $74,520

7 0
4 years ago
What two things do you consider when evaluating the time value of money?
White raven [17]

Items that are not a nesscity?

If so I think about what i need first because thats more important

And I think about how much im about to spend... if it is more that what u have or rlly close its not worth it..

8 0
3 years ago
Request the entrepreneur to share his/her key success factors and elaborate on this success factors
Bogdan [553]
I interviewed a successful salon owner, and this is what determine her success according to her :

- Persevere ,  do not give up if somehow something doesn't go how you want it to be
- Care about your customer, and your business should live to fulfill what they need from you

hope this helps<span />
6 0
3 years ago
Read 2 more answers
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