Answer and Explanation:
The computation is shown below:
a. The receivables Turnover Ratio and Inventory Turnover Ratio is
receivables Turnover Ratio is
= Net credit sales ÷ average account receivable
= $86,000 ÷ ($6,500 + $6,900) ÷ 2
= $86,000 ÷ $6700
= 12.84 times
Inventory turnover ratio is
= Cost of goods sold ÷ average account receivable
= ($86,000 × (1 - 49.8%) ÷ ($7,280 + $7,300) ÷ 2
= $43,172 ÷ $7,290
= 5.92 times
b. The average days to collect receivables and inventory is
For receivables
= 365 ÷ 12.84 times
= 28.43 days
For inventory
= 365 ÷ 5.92
= 61.66 days
Answer: C. Subco borrows in the currency of Eastlaco.
Explanation:
Exchange rate risk only occurs when an entity borrows in a currency that is not their own. This means that if the currency they borrowed in was to appreciate against theirs, they would have to pay more than usual.
Subco is located in Eastlaco so if they borrowed funds in the currency of Eastlaco they would not have to worry about exchange rate risk because they are paying back in their local currency which cannot appreciate or depreciate against itself.
Answer:
It can be tempting to pay the minimum amount due on your credit card bill, but it can be really expensive in the long run. Here's what happens if you only pay the minimum on your credit card.
Answer:
Facultative
Explanation:
Facultative reinsurance is a type of coverage which covers a single risk or a block of risks held in the book of business of the insurer who has purchased the cover.
It allows the company which reinsurance to review individual risks which helps in determining whether to accept or reject them
The Facultative reinsurance is more focused in nature.
