On January 1,2011,Company Z Had Accounts Receivable of $5,000

question 104

Multiple Choice

On January 1,2011,Company Z had accounts receivable of $5,000.During the year,Company Z sold $100,000 of merchandise to credit customers.At December 31,2011,Company Z had accounts receivable of $4,000.How much cash did the company collect from credit customers during the year?

• A)$105,000
• B)$101,000
• C)$99,000
• D)$95,000

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Definitions:

Financial Leverage

The use of borrowed funds or debt to amplify returns from an investment or project.

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to increase liquidity.

Reverse Split

A corporate action in which a company decreases the number of its outstanding shares to increase the share price.

Total Market Value

The aggregate valuation of a company or asset in the marketplace, based on current share price and the total number of outstanding shares.