Data on Shick Inc

question 75

Multiple Choice

Data on Shick Inc. for 2008 are shown below, along with the days sales outstanding of the firms against which it benchmarks. The firm's new CFO believes that the company could reduce its receivables enough to reduce its DSO to the benchmarks' average. If this were done, by how much would receivables decline? Use a 365-day year. Sales $110,000
Accounts receivable $16,000
Days sales outstanding (DSO) Benchmarks' days sales outstanding (DSO) 20.00

• A) $8,078
• B) $8,975
• C) $9,973
• D) $10,970
• E) $12,067

Calculate the intrinsic value of stocks using dividend discount models.

Understand the impact of dividend policy on dividend growth rate and firm valuation.

Comprehend the Gordon growth model and its conditions for application.

Describe the dividend reinvestment and its impact on company growth and stock value.

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Definitions:

First Ventricle

Also known as the left ventricle, a chamber of the heart responsible for pumping oxygenated blood to the aorta and systemic circulation.

Limbic System

A complex system of nerves and networks in the brain, involved with instinct and mood, controlling basic emotions, and drives such as fear and pleasure.

Basic Survival Instincts

The innate, automatic behaviors and responses aimed at preserving one’s life and well-being.

Voluntary Movements

Movements controlled consciously by the brain, usually in response to stimuli or as deliberate actions, contrasting with involuntary movements like reflexes.