Table 15.1 Irish Air Services Has Determined Several Factors Relative to Its

question 42

Multiple Choice

Table 15.1
Irish Air Services has determined several factors relative to its asset and financing mix.
(a) The firm earns 10 percent annually on its current assets.
(b) The firm earns 20 percent annually on its fixed assets.
(c) The firm pays 13 percent annually on current liabilities.
(d) The firm pays 17 percent annually on long-term funds.
(e) The firm's monthly current, fixed, and total asset requirements for the previous year are summarized in the table below:
-The firm's initial ratio of current to total assets is ________. (See Table 15.1)

• A) 1:3.2
• B) 3:1
• C) 2:3
• D) 3:2.3

---

Definitions:

Physical Deterioration

The gradual loss of an asset's functional utility or value due to wear and tear or aging.

Material Wastage

The unwanted or unusable materials produced during a manufacturing or consumption process. It reflects inefficiency and can impact operational costs.

Selling Costs

Expenses associated with promoting and selling a company's products or services.

Net Purchases

The total cost of purchases in a period minus purchase returns, allowances, and discounts.