Peak Performance Sporting Goods Company Has Just Applied for a Bank

question 307

Multiple Choice

Peak Performance Sporting Goods Company has just applied for a bank loan in order to expand the business.Using the most recent Balance Sheet data provided by the company owner,you calculate that the company's current ratio is 2.5.In your presentation to the company boss,you remark:

• A)Peak Performance is currently having trouble meeting its short-term obligations.
• B)Peak Performance has $2.50 that it owes each month,for every $1.00 of cash that it is generating.
• C)Peak Performance has $2.50 of current assets for each $1.00 of currently liabilities.
• D)Due to the fact that most of Peak Performance's current assets are tied-up in inventory,there is no need to worry about whether Peak Performance will be able to make loan payments.

Understand the fundamentals of preparing and managing cash flow forecasts and their significance to the overall budgeting process.

Understand the key components and differences in budget structures between merchandisers and manufacturers.

Identify and describe the roles and responsibilities within the budget preparation process in companies.

Match key budgeting terms with their definitions to understand various types of budgets and their purposes.

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Definitions:

Norepinephrine

A neurotransmitter and hormone involved in the body's fight or flight response, affecting blood pressure, heart rate, and sugar metabolism.

Serotonin

A neurotransmitter in the brain that plays a key role in stabilizing mood, feelings of well-being, and happiness, also affecting digestion, sleep, and other bodily functions.

Depression

A common mental disorder characterized by persistent sadness, lack of interest, and a range of emotional and physical problems, affecting an individual's daily functioning.

SSRIs

Selective Serotonin Reuptake Inhibitors, a class of drugs typically used as antidepressants in the treatment of depression, anxiety disorders, and some personality disorders.