If a business is overtrading, do you think the following ratios would be higher or lower than

Question:

If a business is overtrading, do you think the following ratios would be higher or lower than normally expected?

1. Current ratio

2. Average inventories turnover period

3. Average settlement period for trade receivables

4. Average settlement period for trade payables

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial Management For Decision Makers

ISBN: 9781292311432

9th Edition

Authors: Peter Atrill

See More Books

Question Posted: Dec 31, 2023 12:53 AM

See More Questions

Ann Carter, Chief Financial Officer of Consolidated Electric Company (Con El), must make a recommendation to Con Els board of directors regarding the firms dividend policy. Con El owns two...
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
The following information related to ExxonMobils inventories is taken from the companys 2009 annual report. You are to use this information in answering the questions that follow. Inventories. Crude...
Consider the real projective n-space RP" obtained by identifying each point S" with its antipode -r. (a) Compute its fundamental group. (b) Find all its covering spaces up to isomorphism.
Refer to the data for the Blending Department of Sunspots Beverages, Ltd., in Problem 4-13. Assume that the company uses the FIFO method rather than the weighted-average method in its process costing...
An iron bar 2.00 cm x 3.00 cm x 10.0 cm at a temperature of 95C is dropped into a barrel of water at 25C. The barrel is large enough so that the water temperature rises negligibly as the bar cools....
how to build an additive index and check if it is acceptable
Finger Lakes Winery is a small, family-run operation in upstate New York. The winery produces. Two varieties of wine: riesling and chardonnay. Among the activities engaged in by the winery are the...
Give example for Conservatism & Materiality.
Peachtree Delivery Service is owned and operated by Jerome Foley. The following selected transactions were completed by Peachtree Delivery Service during February: 1. Received cash from owner as...
Let us assume that research indicates that a particular ratio is shown to be a good predictor of failure. Can you think of a practical problem that may arise when using this ratio to predict...
Calculate the margin of safety for the higher geared option and interpret its significance.
The file named Faberu.xlsx contains salaries, travel expenses, faculty ID, department code, and faculty code for all the business-school faculty. Use this data to answer the following questions. Use...
What do you think of the gainsharing plan that Harrah's has implemented? How does an employee make more money? How much more money can they make? Is the gainsharing plan motivating employees to...
How do power dynamics within an organization affect employee empowerment and autonomy, and what are the best practices for creating a balanced power structure ?
In thinking about management and incentive structures: What recommendations do you have for the Responsible Innovation team as they seek to better embed responsible innovation within employees'...
How do multinational companies adapt their corporate governance procedures and decisions to accommodate the different national and regional regulatory requirements and business ethics? Requirement: I...
How do "complexity theory" and the concept of "emergent properties" inform our understanding of organizational dynamics, particularly in the context of nonlinear interactions and unpredictable...
Men with prostate cancer were randomly assigned to undergo surgery (n = 347) or "watchful waiting" (no surgery, n = 348). Over the next several years there were 83 deaths in the first group and 106...
Organizations are increasing their use of personality tests to screen job applicants. What are some of the advantages and disadvantages of this approach? What can managers do to avoid some of the...
A nursing home, which is linked to a large hospital, has been examining its budgetary control procedures, with particular reference to overhead costs. The level of activity in the facility is...
A nursing home, which is linked to a large hospital, has been examining its budgetary control procedures, with particular reference to overhead costs. The level of activity in the facility is...
A nursing home, which is linked to a large hospital, has been examining its budgetary control procedures, with particular reference to overhead costs. The level of activity in the facility is...
Al preparar el estado de resultados pro forma, cules de las siguientes partidas se deducen de las utilidades brutas para llegar a las ganancias despus de impuestos? Pregunta de seleccin mltiple....
Lawson Inc. is expanding its manufacturing plant, which requires an investment of $4 million in new equipment and plant modifications. Lawson's sales are expected to increase by $3 million per year...
20 On January 1, Year 1, X Company purchased equipment for $80,000. The company estimates that the equipment will have a useful life of 10 years and a residual value of $5,000. X Company depreciates...

If a business is overtrading, do you think the following ratios would be higher or lower than

Question:

Step by Step Answer:

Your answers should be as follows 1 The current ratio would be lower than normally expected T...View the full answer

Financial Management For Decision Makers

Students also viewed these Business questions