Question
Question 14 1 pts Recently the N&N Company has been having problems. As a result, its financial situation has deteriorated. N&N approached the Oro National
Question 14 1 pts
Recently the N&N Company has been having problems. As a result, its financial situation has deteriorated. N&N approached the Oro National Bank for a badly needed loan, but the loan officer insisted that the current ratio (now 0.5) be improved to at least 0.8 before the bank would even consider granting the credit. Which of the following actions would do the most to improve the ratio in the short run?
Group of answer choices
Paying off some long-term debt
Purchasing additional inventory on credit (accounts payable)
Collecting some of the current accounts receivable
Using some cash to pay off some current liabilities
Question 15 1 pts
When a balance sheet amount is related to an income statement amount in computing a ratio,
Group of answer choices
The ratio loses its historical perspective because a beginning-of-the-year amount is combined with an end-of-the-year amount.
The balance sheet amount should be converted to an average for the year.
The income statement amount should be converted to an average for the year.
Comparisons with industry ratios are not meaningful.
Question 16 1 pts
Use the following information for the next three items.
The balance sheet of Y Company showed the following:
Accounts payable | P145,000 |
Accounts receivable | 110,000 |
Accrued liabilities | 4,000 |
Cash | 80,000 |
Income tax payable | 10,000 |
Inventory | 140,000 |
Marketable securities | 250,000 |
Notes payable, short-term | 85,000 |
Prepaid expenses | 15,000 |
The amount of working capital for the company is
Group of answer choices
P211,000
P351,000
P336,000
P361,000
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