LeokLee Industries Has an Average Accounts Payable Balance of $720,000

question 12

Multiple Choice

LeokLee Industries has an average accounts payable balance of $720,000. Its average annual cost of goods sold is $8,760,000. It receives terms of 1/10 net 30 from its suppliers. Is LeokLee managing its accounts payables well?

• A) Yes, since it, on average, chooses not to take the discount, but pays when payment is due.
• B) Yes, since it, on average, takes the discount, and pays at the end of the discount period.
• C) Yes, since it, on average, stretches payment beyond the due payment date.
• D) No, since it, on average, does not take advantage of the discount period and pays well before payment is due.

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Definitions:

Phenothiazines

A group of antihistamine drugs that became the first group of effective antipsychotic medications.

Psychodynamic Approaches

A set of psychological theories and therapeutic methods which emphasize the influence of the unconscious mind and childhood experiences on behavior.

Schizophrenia

Schizophrenia is a chronic brain disorder characterized by delusions, hallucinations, disorganized speech, and impaired social or occupational functioning.

Unconscious Desires

Wishes or motivations that are not readily available to consciousness but influence behaviors and emotions.