1. Short-term debt provides a more flexible form of financing than long-term debt.

a.

True

b.

False

2. Accrued wages and taxes are secured sources of financing because companies are obligated to make these payments before they make payments on any other loans or pay dividends.

a.

True

b.

False

3. Variable costs include all of the following except;

a.

direct materials.

b.

direct labor.

c.

packaging.

d.

annual rent.

5. An investor who pays no tax would be more likely to accept the view that high dividends increase stock values rather than the view that low dividends increase stock values.

a.

True

b.

False

Please do explain as to why!