1. An entity offers their customers discount terms of 2/10 net 30 to encourage payment of invoices. What does this mean? Take 2% off if paying within 30 days. Take 2% off if paying within 10 days, or pay 100% before 30 days. Pay 10% today and the balance in 30 days. In two days' time, pay 10% and the balance in 30 days. 2. The investment decision rule for net present value calculations is to invest: a in the project with the highest positive NPV. b. in the project with the lowest discount rate. in the project with the highest discount rate. d in the project with the lowest NPV. 3. The equation used to find the IRR is similar to the NPV equation, except that: the discount rate for IRR is always higher than for NPV. the discount rate for IRR is always lower than for NPV. the value of the equation is set to zero when finding the IRR. none of the options are true. 4. Which of the following is not a cost of granting credit to customers? a. The opportunity cost of funds being tied up. b. Administration costs for managing receivables. c. Attracting new customers. d. The cost of carrying slow payers and bad debts. 5. Loans which are initially drawn down to the full amount and repaid over the term of the loan by a fixed repayment schedule are known as: instalment loans. b. interest only loans. c. business loans d. fully drawn advance Open Word 6. If average inventory is $265 000, total credit sales is $1 200 000 and cost of sales is 5890 000, the days inventory turnover is (round your answer up to the next full number of days): 69 days. 109 days 43 days. none of the above. 7. Emission trading schemes are expected to: promote the generation of renewable energy. provide incentives to businesses and households to consume less energy. encourage better management of emissions. all of these options are true. 8. A statement setting out the entity's overall philosophy and objectives is a/an: financial statement integrated statement. mission statement. income statement 9. From the list below, the best financial performance measure for a profit centre would be: cash inflows less cash outflows. budgeted income less actual income. budgeted costs less actual costs. economic value added. 10. If a company's profit is $400,000 and its investment is $2,200,000 return on investment is: Open Word a. b. 1.3% 15.5%