Which of the following statements is most correct?

	a.	Seasonal dating with terms 2/15, net 30 days, with April 1 dating, means that if the original sale took place on February 1st, the customer can take the discount up until March 15th, but must pay the net invoice amount by April 1st.
	b.	Firms use seasonal dating primarily to decrease their DSO.
	c.	It is possible for a firm to overstate profits by offering very lenient credit terms which encourage additional sales to financially "weak" firms. A major disadvantage of such a policy is that it is likely to increase uncollectible accounts.

2. Which of the following is not correct?

a.

Collection policy is how a firm goes about collecting past-due account.

b.

Typically a firm will turn over an account to a collection agency only after it has tried several times on its own to collect the account.

c.

A lax collection policy will frequently lead to a decrease in accounts receivable.

Which of the following is not correct?

	a.	Collection policy is how a firm goes about collecting past-due account.
	b.	Typically a firm will turn over an account to a collection agency only after it has tried several times on its own to collect the account.
	c.	A lax collection policy will frequently lead to a decrease in accounts receivable.

Which of the following will cause an decrease in net working capital, other things held constant?

	a.	A cash dividend is declared and paid.
	b.	Cash is used to buy marketable securities.
	c.	Long-term bonds are retired with the proceeds of a preferred stock issue