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A firm has current assets of $50 million and fixed assets of $75 million. The firm's current liabilities is $25 million. The firm has a

A firm has current assets of $50 million and fixed assets of $75 million. The firm's current liabilities is $25 million. The firm has a debt ratio of 40%. The firm has sales of $500 million and net income of $60 million. If the net income changes to $65 million (all else is the same), the total asset turnover will

increase

decrease

stay the same

A firm reduces its accounts payable from 15 days to 12 days. Its main competitors have payables at 13 days. Which of the following will happen?

dividends will increase

dividends will decrease

cash flows will increase

cash flows will decrease

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