Exam 16: Assets: Inventory and Operations Management

_____ is a method of estimating asset value by calculating the net amount that you would realize were you to sell the asset in an "arm's-length" transaction.

Differentiate between periodic and perpetual inventory.

Replacement value is an accounting term that describes the difference between the original acquisition cost of capital assets and the amount of depreciation expense that has been recognized for them.

If you are offering assets as collateral,lenders are most interested in _____ value.

One of the policies for managing customer credit requires business owners to maintain constant "aging" of accounts to quickly identify customers who become delinquent.

Identify the term used for an asset with a fixed determinable period of utility.

A general term for the facilities of a business is called:

Which of these is NOT an accounting method to value capital assets?

The primary disadvantage of leasing is that:

Which of these represents the current practice for small businesses to provide credit?

Describe the pros and cons of offering credit to customers.

Selling the right to collect accounts receivable to an entity outside your business is called:

This method defines utility as being the net cash inflows that the asset will produce.

EOQ helps you think in terms of

The primary advantage of replacement value is that you can be quite confident of its accuracy.

The cost of owning and holding inventory is far greater than the cost of ordering inventory.

The two most commonly used financial ratios for comparing investment alternatives are payback period and return on sales.

Discuss the mechanics of just-in-time inventory systems.

Describe economic order quantity (EOQ)and its effectiveness for small businesses.

The _____ is the amount of inventory that results in the minimum cost,considering the cost of lost sales resulting from running out of stock,the number of units sold per day,and the number of days required to receive inventory.