1. The necessary adjustment(s) to the cost of goods sold amount shown on the income statement to arrive at cash paid to suppliers is(are): a. subtract the change in accounts payables

b. add the change in inventories

c. subtract the change in inventories

d. a and b

e. a and c

2. The necessary adjustment(s) to the cost of goods sold amount shown on the income statement to arrive at cash paid to suppliers is(are):

	a.	subtract the change in accounts payables
	b.	add the change in inventories
	c.	subtract the change in inventories
	d.	a and b
	e.	a and c

3. The current ratio and the quick ratio are best characterized as ________________ ratios.

		a. Leverage
		b. Liquidity
		c. Financial Flexability
		d. Net Balance

4. An automobile manufacturer has decided to outsource windshields instead of making them itself. Using an outside supplier under the just-in-time approach will have what immediate effect on the manufacturer's inventory management?

	a.	reduce finished goods inventories
	b.	increase raw material inventories
	c.	reduce work in process inventories
	d.	both a and b