Which of the Following External Groups Uses Accounting Information to Determine

question 1

Multiple Choice

Which of the following external groups uses accounting information to determine whether the company can pay its obligations?

• A)Investors in common stock
• B)Marketing managers
• C)Creditors
• D)Chief Financial Officer

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Definitions:

Accounts Payable

Money owed by a business to its suppliers or creditors for goods and services received but not yet paid for.

Days' Payable Outstanding

Days' Payable Outstanding (DPO) is a financial ratio that indicates the average time (in days) that a company takes to pay its bills and invoices to its trade creditors.

Accounts Payable

Accounts payable are amounts a company owes because it purchased goods or services on credit from a supplier or vendor.

Days' Payable Outstanding

A financial metric that measures how long it takes a company to pay its invoices from suppliers, reflecting on cash management practices.