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3 years ago

Which of the following companies is most likely to have a negative Cash Conversion Cycle?

Business

1 answer:

Veseljchak [2.6K]3 years ago

3 0

Answer:

a) A discount retailer

Explanation:

The formula to determine the cash conversion cycle is shown below:

Cash Conversion Cycle = days inventory outstanding + days sales outstanding - days payables outstanding.

So as per the given situation, the first option i.e. discount retailer should have the negative cash conversion cycle as in other options it created the positive impact

So the option a is correct

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Each of the following factors affects the weighted average cost of capital (WACC) equation. Which are factors that a firm cannot

QveST [7]

Answer:

-Tax rates

-The general level of stock prices

Explanation:

The factors that a firm cannot control are the ones that it has no power to decide and they are determined by a third party. According to that, from the options given, the factors that the firm cannot control are tax rates because they are established by the government and the general level of stock prices because it is determined by the supply and demand in the market.

The other options are not right because the company can establish its process to evaluate investments and expenses and how to finance its assets with debt and equity.

7 0

4 years ago

First Bank offers personal loans at 7.7 percent compounded monthly. Second Bank offers similar loans at 7.4percent compounded da

Korolek [52]

Answer:

The First Bank loan has an effective rate of 7.98 percent.

Explanation:

we calcualte the effective rate for both loand and check which statement is correct.

<u>First bank:</u>

$(1+\frac{0.077}{12} )^{12} = 1 + r_e$

$(1+\frac{0.077}{12} )^{12} - 1 = r_e$

1.07977643 - 1 = 0.07977 = 7.98%

<u>Second bank:</u>

$(1+\frac{0.074}{365} )^{365} = 1 + r_e$

$(1+\frac{0.077}{365} )^{365} - 1 = r_e$

1.076798729 - 1 = 0.076798729 = 7.68%

Notice tthis isthe effective rate not the annual percentage rate.

So only the statement abour the first bank effectibe rate is true.

7 0

3 years ago

Town A, in one hour, can produce either 4 hotdog buns, or 10 sausages. Town B, in one hour, can produce either 8 hotdog buns, or

katrin [286]

Answer:

The answer is 27 hours

Explanation:

Solution

The Comparative advantage depends on production of the lower opportunity cost

The opportunity cost of a production is =maximum production of other good /maximum production of the good

Now,

The opportunity cost of hot dog bun for town A =10/4=2.5

Thus,

The opportunity cost of hot dog bun for town B=6/10=0.6

So,

The town B has a comparative advantage in hot dog buns and A in sausages

Town A will produce-only sausages and it will take the time of

time in hours =total required a quantity of the good /number of products in an hour

Now,

The time for Town A for sausages=120/10=12 hours

The time for Town B for hot dog buns=120/8=15 hours

Therefore, The total time =12+15=27 hours.

6 0

3 years ago

G MC Qu. 87 When is a goodwill impairment loss... When is a goodwill impairment loss recognized?

marin [14]

Answer:

Goodwill impairment occurs when a company decides to pay more than book value for the acquisition of an asset.

An impairment is recognized as a loss on the income statement and as a reduction in the goodwill account. The amount of the loss is the difference between the current fair market value of the asset and its carrying value or amount.

Explanation:

6 0

3 years ago

Klingon Widgets, Inc., purchased new cloaking machinery three years ago for $5.4 million. The machinery can be sold to the Romul

Semmy [17]

Answer:

a. $5,194,000

b. $7,715,000

Explanation:

a. Book Value of assets = Book value of fixed assets + book value of current assets

Book Value of assets = Book value of fixed assets + (Current Liabilities + Net working capital)

Book Value of assets = $4,200,000 + ($850,000 + $144,000)

Book Value of assets = $5,194,000

b. Sum of market value = $7,600,000 + ($965,000 - $850,000)

Sum of market value = $$7,600,000 + $115,000

Sum of market value = $7,715,000

8 0

3 years ago