TestBank 4 - Financial Markets
TestBank 4 - Financial Markets
TestBank 4 - Financial Markets
current assets uses a ____ proportion of short-term B. relatively high, relatively low
debt and a ____ proportion of long-term debt.
B. Small, higher
proportion of the firm's total assets in the form of current assets
will tend to result in a ____ expected profitability or rate of return
on the total assets of the firm.
Borrowers (e.g., business firms) feel that there is A. uncertainty arising from interest rate
more risk associated with short-term debt (as fluctuations and B. risk of being unable
compared with long-term debt) because of the to refund the debt
The ____ is the optimal working capital investment and financing policy
a.
D. 107.2 days
gross profit margin of 30% last year. If Linear Technology's
inventory averaged $3.9 million, and its accounts receivable
were $5.0 million, what was the length of its operating cycle?
Runners Ink, Inc. had sales last year of $700,000 and 35 percent
C. $47,370
of its sales are for cash, with the remainder buying on terms of
net 30 days. If the receivables conversion period is actually 38
days, what is Runners Ink's accounts receivable?