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

question 33

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:
-If the firm's current liabilities in December were $40,000, the net working capital was ________. (See Table 15.1)

• A) $140,000
• B) $60,000
• C) $10,000
• D) -$10,000

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Definitions:

Specialized Machine

Machinery designed to perform a specific task or function in a manufacturing or production process.

Work in Process Accounts

Accounts that track the costs associated with unfinished goods that are in the process of being manufactured.

Overhead Costs

Indirect expenses related to the general operation of a business, such as rent, utilities, and management salaries, not directly tied to production.