A Firm Desires to Increase Its Ratio of Cash Flow

question 36

Multiple Choice

A firm desires to increase its ratio of cash flow from operations divided by average current liabilities from its anticipated level of 30 percent for the coming year to a more desirable level of 40 percent.Which of the following actions is consistent with this increase?

• A)increase short-term bank borrowing
• B)decrease the number of days that accounts receivable are outstanding
• C)decrease the number of days accounts payable are outstanding
• D)increase the number of days inventories are held
• E)none of the above

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Definitions:

Cardiomyopathy

A group of diseases that affect the heart muscle, often leading to heart failure and other complications.

Nephrology

A branch of medicine that focuses on the diagnosis and treatment of diseases of the kidneys.

Musculoskeletal

Pertains to the combined system of muscles and bones in the body, supporting movement, stability, and physical strength.

Neurological

Pertaining to the nervous system, including the brain, spinal cord, and nerves throughout the body.