A Firm Is Considering Changing Their Credit Terms

question 84

Multiple Choice

A firm is considering changing their credit terms. It is estimated that this change would result in sales increasing by $1,600,000. This in turn would cause inventory to increase by $125,000, accounts receivable to increase by $100,000, and accounts payable to increase by $90,000. What is the firm's expected change in net working capital?

• A) $1,735,000
• B) $315,000
• C) $225,000
• D) $135,000

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Definitions:

Gender-Aschematic

Refers to individuals who do not use gender as a major category for organizing information and making judgments about others, viewing people as individuals rather than through the lens of gender stereotypes.

Rosy

Characterized by a hopeful or optimistic perspective, often without considering possible difficulties.

Superstitious Methods

Practices based on belief in luck, magic, or the supernatural, often without scientific basis.

Social Learning Theory

A theory suggesting that individuals learn new behaviors through observing and imitating others, along with the influence of rewards and punishments.