Which of the Following Statements Best Describes Accounts Receivable

question 33

Multiple Choice

Which of the following statements best describes accounts receivable?

• A) If a security analyst saw that a firm's DSO was higher than the industry average and was also increasing and trending still higher, this would be interpreted as a sign of strength.
• B) If a firm increases its sales while holding its accounts receivable constant, then, other things held constant, its DSO will increase.
• C) There is no relationship between the DSO and the ACP. These ratios measure entirely different things.
• D) If a firm increases its sales while holding its accounts receivable constant, then, other things held constant, its days' sales outstanding will decline.

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Definitions:

Self-motivation

The ability to do what needs to be done, without influence from other people or situations.

Entrepreneurial Business

A venture initiated by an entrepreneur aimed at seeking innovation and growth through unique or compelling products or services.

Emotional Roadblocks

Psychological or emotional barriers that inhibit progress, decision making, or completion of objectives.

Creativity

The ability to produce original and valuable ideas or solutions by thinking beyond traditional frameworks or exploring new perspectives.