Quiz Ch 15 – Indicators of Efficient Inventory Management
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
What indicates efficient inventory management in a firm?
What indicates efficient inventory management in a firm?
In an upward-sloping yield curve, what is the CORRECT strategy for a firm’s emergency marketable securities portfolio?
What is the primary purpose of a lockbox plan?
Based on the provided balance sheet data, what conclusion can be drawn regarding Swim Suits Unlimited’s current asset financing policy?
True or false: Implementing a lockbox arrangement is a means for a firm to expedite the receipt of payments from its customers.
True or false: If a customer delays its accounts payable but periodically settles the entire balance, it may inconvenience your firm, but it does not pose a genuine financial cost.
True or false: When a profitable firm must extend its accounts payable, it suggests undercapitalization, indicating the need for additional working capital to support operations.
True or false: The absence of explicit interest payments on accruals and the firm’s ability to adjust these accounts as needed make them an appealing source of funding for meeting working capital requirements.
True or false: The cash conversion cycle (CCC), encompassing inventory conversion, receivables collection, and payables deferral, indicates how long a firm finances its working capital. A shorter CCC implies more efficient working capital management, all else being equal.
True or false: Accruals are generated from a firm’s operations and typically do not entail explicit interest payments, making them a form of “free” capital.