Exam 12: The Management of Working Capital

All of these are assumptions of the economic order quantity model, except:

Sales forecasts to help determine the amount of inventory to be held can be based on all of the following except:

Improving cash flow in relation to debtors and creditors, respectively, requires:

Which of the following is not necessarily true? Increasing the cash discount which a firm offers to its debtors for prompt payment will:

Credit policy is composed of:

The business which is likely to have the heaviest investment in working capital is a:

Procedures and techniques for managing inventory are all of the following except:

In relation to the economic order quantity model:

Items which comprise inventory are:

Which of these is not a way in which the length of the operating cycle can be reduced?

A decline in the level of working capital will:

An increase in the effort put into collection of accounts receivable will result in in the investment in accounts receivable, in bad debts expense, and in collections expenditure.

Which statement concerning the economic order quantity (EOQ) model is not correct?

If inventory is turned over 7 times a year, the inventory turnover period in days is:

A firm has annual credit sales of $2 million, an average debtor's balance of $300,000 and works 365 days a year. The average settlement period for debtors is:

An advantage of holding inventory is:

The ABC system of managing inventory:

The item that is not part of working capital is:

Calculate the operating cash cycle if the inventory turnover period is 21 days, the debtor's turnover period is 32 days and the creditor turnover period is 40 days.

Which statement is not true?