Bercraft Industries Has an Average Accounts Payable Balance of $280

question 70

Multiple Choice

Bercraft Industries has an average accounts payable balance of $280 000. Its average annual cost of goods sold is $4 780 000. It receives terms of 1/20 net 40 from its suppliers. Is Bercraft managing its accounts payables well?

• A)Yes, since it, on average, chooses not to take the discount, but pays when payment is due.
• B)Yes, since it, on average, takes the discount and pays at the end of the discount period.
• C)Yes, since it, on average, stretches payment beyond the payment due date.
• D)No, since it, on average, does not take advantage of the discount period and pays well before payment is due.

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Definitions:

Homogamy

Dating or marrying someone with similar social characteristics (sometimes called endogamy).

Heterogamy

Dating or marrying someone with social characteristics that differ from your own (sometimes called exogamy).

Speed Dating

A method of meeting potential romantic partners in which participants have brief conversations with a series of individuals in order to determine mutual interest.

Stalking

The act of repeatedly following, watching, or contacting someone in a way that is threatening or invasive.