Which of the Following Statements Is Most Correct

question 9

Multiple Choice

Which of the following statements is most correct?

• A) If credit sales as a percentage of a firm's total sales increases, and the volume of credit sales also increases, then the firm's accounts receivable will automatically increase.
• B) It is possible for a firm to overstate profits by offering very lenient credit terms which encourage additional sales to financially "weak" firms. A major disadvantage of such a policy is that it is likely to increase uncollectible accounts.
• C) A firm with excess production capacity and relatively low variable costs would not be inclined to extend more liberal credit terms to its customers than a firm with similar costs that is operating close to capacity.
• D) Firms use seasonal dating primarily to decrease their DSO.
• E) Seasonal dating with terms 2/15, net 30 days, with April 1 dating, means that if the original sale took place on February 1st, the customer can take the discount up until March 15th, but must pay the net invoice amount by April 1st.

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Definitions:

Neural Crest

A population of cells in vertebrate embryos that arises from the embryonic ectoderm and migrates to form diverse cell types, including melanocytes, craniofacial cartilage, and neurons.

Organogenesis

The phase during embryonic development where organs form from the three germ layers, setting the foundation for functional body systems.

Embryonic Development

The process of development of a new organism from a single-celled zygote to a complex structure composed of multiple cells and tissues.

Induction

A process in developmental biology where one cell or tissue type influences the development of another cell or tissue type, leading to a specific developmental pathway or pattern.