Short-Term Creditors Are Likely to View a Higher-Than-Average Inventory Turnover

question 102

Multiple Choice

Short-term creditors are likely to view a higher-than-average inventory turnover rate as indicating that:

• A)A company is in financial difficulty.
• B)The company is able to sell its inventory quickly.
• C)The company probably has an excessive amount of inventory.
• D)The company has a longer-than-average operating cycle.

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Definitions:

At Will

A term used in employment law indicating that an employment relationship can be terminated by either the employer or the employee at any time, for any reason not prohibited by law.

Whistleblower

An individual who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organization.

Social Insurance Programs

Government-sponsored programs designed to provide financial support to individuals in events such as unemployment, disability, or retirement.

Social Security Administration

A U.S. government agency that administers social security, a social insurance program consisting of retirement, disability, and survivors' benefits.