A Company with Accounts Payables of R35 000 and Cost

question 60

Multiple Choice

A company with accounts payables of R35 000 and cost of goods sold of R300 000 would have an average payment period of:

• A)24 days.
• B)32 days.
• C)43 days.
• D)The answer is not one of the above choices.

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Definitions:

Coupon Bonds

Debt securities that pay the holder a fixed interest rate (coupon) over a specified period until maturity, at which point the principal amount is repaid.

Interest Rate Sensitive

Refers to investments or financial instruments that are significantly impacted by changes in interest rates.

Yield To Maturity

The total return anticipated on a bond if held until it matures, factoring in current market price, par value, coupon interest rate, and time to maturity.

Semi-Annual

Occurring twice a year; pertaining to a period of six months.