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10. Jack & Jill Inc. produced products for inventory. Now, the firm only produces a product when it receives an actual order from a customer.

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10. Jack & Jill Inc. produced products for inventory. Now, the firm only produces a product when it receives an actual order from a customer. Which one of the following actions will tend to increase the accounts receivable period? Assume the accounts receivable period is currently 32 days. a. tightening the standards for granting credit to customers b. granting discounts for cash sales c. increasing the finance charges applied to all customer balances outstanding over 30 days d. eliminating the discount for carly payment by credit customers 11. The operating cycle describes how a product: a. Is priced b. Is sold c. Moves through the current asset accounts d. Moves through the production process e. Generates a profit 12. All of these statements are correct, EXCEPT: a. Float management deals with speeding up collections; i.e. reducing collection float and slowing down disbursements b. Cash collection choices are like any other project of the firm and can be evaluated using NPV. c. The special post office boxes that allow banks to process incoming checks and send the information on account payment to the fim are referred to as lockboxes. d. Deposits are normally available immediately. 13. The is the amount of cash recorded in the accounting records of the firm, while the is the amount of cash showing on the bank's books available to be withdrawn from the account. Finally, the is generated by checks the firm has written that have not yet cleared the bank; arrangements can be made so that this money is invested in marketable securities until needed to cover the checks. a. Book balance Available balance/Disbursement float b. Book balance Disbursement float Collection float c. Available balance Collection balance/ Net float d. Book balance Float Disbursement float

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