Which of the Following Is Not a Reason a Supplier

question 30

Multiple Choice

Which of the following is not a reason a supplier might seek to sell in bulk?

• A)Each sale incurs a fixed cost in writing a contract
• B)The purchaser is likely to switch over a small price due to the gains over the large number of units ordered
• C)Each sale involves setting up a different production run
• D)The cost of delivery is a fixed on a per unit basis
• E)The supplier fears uneven sales

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Definitions:

Acid-test Ratio

The acid-test ratio is a financial metric used to assess a company's ability to pay off its short-term liabilities with its most liquid assets, excluding inventory.

Short-term Investments

Financial assets that are expected to be converted into cash or sold within a year or the operating cycle, whichever is longer.

Current Liabilities

Short-term financial obligations that are due to be paid within one year, such as accounts payable, short-term loans, and taxes owed.

Accounts Receivable Turnover

A measure of the liquidity of accounts receivable; computed by dividing net credit sales by average net accounts receivable.