A Cost That Involves Spending Money Is

question 125

Multiple Choice

A cost that involves spending money is

• A)an implicit cost.
• B)an explicit cost.
• C)an opportunity cost.
• D)an indirect cost.

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Definitions:

Accounts Receivable Turnover

A financial ratio indicating how many times a company's accounts receivable are collected during a specific period, typically a year.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business, whichever is longer.

Short-Term Debt-Paying

Refers to a company's ability to meet its short-term financial liabilities and obligations.

Acid-Test

A stringent financial ratio that measures the ability of a company to pay off its current liabilities with its most liquid assets (cash, marketable securities, and accounts receivable).