Chat with AIExam 16: Assets: Inventory and Operations Management
The capital budgeting equation used to measure the relationship between initial investment and the profits that are expected to be received from making the investment is called _____.
(29) 
VerifiedC
How can a business use its accounts receivable as a source of financing?
(43) VerifiedAccounts receivable are money that is owed to the business by its customers.Having high-quality receivables lets the business get cash to meet unexpected needs.Receivables can be used in two ways to acquire cash quickly.First,receivables can be pledged as collateral for a commercial loan.Depending on the finance company,customer payments on pledged receivables may be collected either by the owner and forwarded to the lender,or may be directly collected by the lender.Second,receivables can be sold to a finance company in a process called factoring.A factoring company will usually pay about 75 to 80 percent of the total amount that can be collected.The factor then collects the receivables.The difference between the gross amount of the receivables and the amount that is ultimately collected is the factor's profit margin.Pledging receivables to a commercial lender is usually less expensive than factoring.When receivables are pledged,the business is liable only for the borrowed amount and accrued interest on the loan,regardless of the amount that is subsequently collected from the customers.This is an opportunity to collect it all.On the other hand,a commercial lender will only loan one-half of the amount that can be collected.
Which of the following is a statistical technique that determines the size of inventory that a business must hold to minimize total inventory cost?
(34) VerifiedD
Bar coding is used to reduce the cost of perpetual inventory systems.
(32) The practice of acquiring inventory only in response to a completed sale is called a(n)_____.
(40) A _____ is a computer-readable tag that is unique to each item of the inventory.
(36) Assuming that the money is received evenly across the year,what will be the payback period if Jack decides to invest in the CZ84 double cut frame saw?
(32) Current practice is for small businesses to only provide direct credit to customers.
(39) Kevin has taken an apartment on lease for five years with a monthly rental of $3,500.At the end of five years,Kevin will be the legal owner of the apartment after an additional payment of $80,000.This type of lease is an example of a _____ lease.
(46) A _____ describes the difference between the original acquisition cost of capital assets and the amount of depreciation expense that has been recognized to date.
(29) In small businesses,providing credit to customers decreases the need to borrow cash.
(39) Factoring receivables to a commercial lender is usually less expensive than pledging receivables.
(34) A(n)_____ refers to the products that are held for sale to customers.
(34) Giving a third party legal rights to debts owed by the business in order to provide assurance that borrowed money will be repaid is called _____.
(38) Which of the following is a disadvantage of providing credit to customers?
(36) Economic order quantity (EOQ)helps a business to think in terms of:
(35) The direct cost incurred in using an asset for the purpose for which it was intended is termed as _____.
(36) The three primary inventories of manufacturing are raw materials,work in process,and finished goods.
(38) Which of the following is a disadvantage of renting capital assets?
(41) _____ is the ratio measure of how well a firm does in using its inputs to create outputs.
(39) 
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