Which of the Following Statements Is CORRECT

question 93

Multiple Choice

Which of the following statements is CORRECT?

• A) If a firm increases its sales while holding its accounts receivable constant, then, other things held constant, its days' sales outstanding will decline.
• B) If a security analyst saw that a firm's days' sales outstanding (DSO)was higher than the industry average and was also increasing and trending still higher, this would be interpreted as a sign of strength.
• C) If a firm increases its sales while holding its accounts receivable constant, then, other things held constant, its days' sales outstanding (DSO)will increase.
• D) There is no relationship between the days' sales outstanding (DSO)and the average collection period (ACP).These ratios measure entirely different things.
• E) A reduction in accounts receivable would have no effect on the current ratio, but it would lead to an increase in the quick ratio.

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Definitions:

Patch

A small application designed to update or fix problems with a software program or an operating system.

Ointment

A form of topical drug; also known as a salve.

Salve

A medicinal ointment used to soothe the skin or heal wounds.

Intradermal Injection

A method of administering medication by injection into the dermis, just below the skin.