The Company Offering a Discount on Accounts Payable Is Trying

question 91

Multiple Choice

The company offering a discount on accounts payable is trying to ________ and the firm that pays on time rather than taking a discount is attempting to ________.

• A)speed up cash outflow; slow down cash inflow
• B)speed up cash inflow; slow down cash inflow
• C)speed up cash inflow; slow down cash outflow
• D)speed up cash outflow; slow down cash outflow

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Definitions:

Expected Profit Rate

The forecasted return on an investment, calculated based on potential outcomes and their probabilities.

Net Inventory Investment

The change in the total value of inventories in an economy during a specific period.

Positive

An attribute or condition that reflects an increase, improvement, or favorable outcome.

Gross Investment

The total amount of capital invested in a firm, including replacements for depreciation and new investments for expansion.