Which of the Following Is the Best Explanation of a Company's

question 47

Multiple Choice

Which of the following is the best explanation of a company's inventory turnover of 12.0 for the year 2013?

• A)the company averages about 12 months' sales in inventory.
• B)The company averages about 12 days' sales in inventory.
• C)The company averages about one month's sales in inventory.
• D)The company averages about 12 days from the time an item is sold until the cash is collected.
• E)None of the answer choices is correct.

Identify different capital budgeting evaluation methods and their applications.

Understand the concept of the time value of money and its application in evaluating investment opportunities.

Gain insights into the impact of cash flows on investment appraisal decisions.

Acknowledge the importance of considering the hurdle rate in investment decision making.

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Definitions:

Conscious Plans

Thoughtfully considered actions or decisions one intends to carry out, fully aware and deliberate.

Perseverative Functional Autonomy

A psychological concept referring to repetitive behaviors that continue because they have become habits or have intrinsic value, not because they are driven by the original motives.

Well-Fed Rat

Describes a rat that has been provided with ample food, ensuring its nutritional needs are met, often used in experimental contexts.

Maze

A complex network of paths or passages in which it is difficult to find one's way; metaphorically, it can refer to a complicated situation or problem that one has to navigate or solve.