An Increase in a Firm's Average Collection Period Generally Indicates

question 45

Multiple Choice

An increase in a firm's average collection period generally indicates that:

• A)the cash flows of the firm have increased
• B)the majority of a firm's receivables are delinquent
• C)an increased number of customers are taking advantage of the cash discount offered
• D)at least some customers are taking longer to pay
• E)customers are paying more promptly

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Definitions:

Mental Combinations

The ability in early cognitive development where a child can mentally mix, match, and rearrange objects or situations without the need for physical manipulation.

Sensorimotor Intelligence

A stage in Jean Piaget’s theory of cognitive development where infants learn through interacting with their environment using their senses and motor actions.

Primary Reactions

Initial, innate responses or reflexes seen in infants as part of their early developmental stages.

New Adaptation

A process by which individuals or species undergo changes or develop new traits over time to better interact with their environment.