A New Project Will Cause Accounts Payable to Increase by $35,000

question 320

Multiple Choice

A new project will cause accounts payable to increase by $35,000, accounts receivable to increase by $40,000 and inventory to decrease by $5,000 Which one of the following statements is true?

• A) The project will not affect net working capital.
• B) The change in accounts payable is a use of cash.
• C) The change in inventory is a use of cash.
• D) The project will decrease the amount of cash provided to customers.
• E) Net working capital will decrease.

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Definitions:

Social Perception

A subfield of social psychology that studies the ways in which we form and modify impressions of others.

Deindividuation

A psychological state where individuals abandon self-awareness and norms in group contexts, leading to uncharacteristic behavior.

Social Facilitation

The tendency for people to perform differently when in the presence of others than when alone, typically performing better on simple or well-rehearsed tasks.

Groupthink

is a psychological phenomenon that occurs within a group of people, where the desire for harmony or conformity results in an irrational or dysfunctional decision-making outcome.