1.Which one of the following will increase the average balance in accounts receivable?

Select one:

A. A decrease in the discount period.

B. A decrease in the trade discount.

C. Cash sales as an increased percentage of total sales.

D. An increase in the sales amount per customer.

E. A decrease in the firm's cheque processing time.

2. You are trying to attract new customers that you feel could become repeat customers. The average price of the items you sell is $49 with a $35 variable cost. Your monthly interest rate is 1.2 percent. Your experience tells you that 5 percent of these customers will never pay their bill. What would be the net present value of this decision?

Select one:

A. $979

B. $1,073

C. $989

D. $1,023

E. $1,108

3.

Which one of the following is designed to benefit the corporation rather than the bondholder?

Select one:

A. Call premium.

B. Call provision.

C. Negative covenant.

D. Positive covenant.

E. Sinking fund.

4.

Collection float:

Select one:

A. Increases the available balance before it increases the ledger balance.

B. Allows you to earn interest on money that technically is no longer yours.

C. Can be reduced by slowing down the cheque processing time within a firm.

D. Is equal to a firm's available balance minus the firm's book balance.

E. Is the result of sending a cheque through the mail to one of your suppliers.

5.

Which of the following is not a right of owners of common shares?

Select one:

A. Share in company profits.

B. Obtain past dividends not paid.

C. Residual assets in liquidation.

D. Vote for company directors.

E. Vote on proposed mergers.

6.

Which type of business organization has all the respective rights and privileges of a legal person?

Select one:

A. Limited liability company.

B. General partnership.

C. Sole proprietorship.

D. Corporation.

E. Limited partnership.