Question
Do you agree with Maggie Brown's policy of paying suppliers early to take advantage of their early-payment discount? A. No, because a 2% discount is
Do you agree with Maggie Brown's policy of paying suppliers early to take advantage of their early-payment discount?
A. | No, because a 2% discount is a trivial amount. | |
B. | Yes, because if cash is short Horniman can get a line of credit at the bank. | |
C. | No, because Horniman's "Payable days" metric is much lower than the benchmark for the industry. | |
D. | Yes, because the annual savings from the discount more than justifies the use of cash for this purpose. |
4) On the basis of the financial ratios and benchmarking information in Exhibit 8.2, Horniman's cash conversion cycle in 2015 was:
A. | Irrelevant to their problems. | |
B. | Much longer than the benchmark cash conversion cycle. | |
C. | Much shorter than the benchmark cash conversion cycle. | |
D. | About the same as the benchmark cash conversion cycle. |
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