Table 3.2 Dana Dairy Products Key Ratios Income Statement

question 18

Multiple Choice

Table 3.2
Dana Dairy Products Key Ratios Income Statement
Dana Dairy Products
For the Year Ended December 31, 2013 Balance Sheet
Dana Dairy Products
December 31, 2013
-If Dana Dairy Products has credit terms which specify that accounts receivable should be paid in 25 days, the average collection period ________ since 2012. (See Table 3.2)

• A) has deteriorated
• B) has remained the same
• C) has improved
• D) cannot be determined

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Definitions:

Monthly Installment

A fixed payment made every month over a set period to repay a debt.

Accounting Equation

The fundamental formula in accounting that represents the relationship between an entity's assets, liabilities, and equity (Assets = Liabilities + Equity).

Liabilities

Financial obligations or debts that a company owes to others, payable in money, goods, or services.

Owner's Equity

Represents the owner’s claims on the assets of a business, calculated as the business’s total assets minus its total liabilities.