On Average Your Firm Sells $26,500 of Items on Credit

question 114

Multiple Choice

On average your firm sells $26,500 of items on credit each day. Your average operating cycle is 51 days and your firm acquires and sells inventory on average every 19 days. What is your average accounts receivable balance?

• A) $503,500
• B) $848,000
• C) $1,012,500
• D) $1,315,500
• E) $1,855,000

Analyze the impact of specific transactions and events on the financial position and cash flows of a company.

Understand how to calculate the effective annual rate for different compounding frequencies.

Recognize and explain the concept of kurtosis in distribution.

Interpret risk measures such as Value at Risk (VaR), Expected Shortfall, and Conditional Tail Expectation.

---

Definitions:

Finances

The management, creation, and study of money, banking, credit, investments, assets, and liabilities.

Backup Data

Copies of original data preserved to prevent loss of information in case of a system failure or data corruption.

Scheduled

Planned or predetermined activities or transactions that occur at specific times or intervals.

Automatically

Refers to processes or operations that are performed by a system or software without manual intervention.