A Firm Has Just Ended Its Calendar Year Making a Sale

question 132

Multiple Choice

A firm has just ended its calendar year making a sale in the amount of $200,000 of merchandise purchased during the year at a total cost of $150,500. Although the firm paid in full for the merchandise during the year, it has yet to collect at year end from the customer. The possible problem this firm may face is

• A) inability to receive credit.
• B) high leverage.
• C) low profitability.
• D) lack of cash flow.

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Definitions:

Age

The length of time that a person or object has existed.

Gender

A social construct that refers to the roles, behaviors, activities, and attributes that a given society considers appropriate for men and women.

Race

A social construct categorizing humans based on physical characteristics, ancestry, genetics, or social relations.

Unemployment Rate

The percentage of the labor force that is jobless and actively looking for employment, a key indicator of the labor market's health.