===> In general, the reduction of an asset is a source of funds. True or False ==> The sustainable growth rate is the maximum growth rate achievable over an extended period of time. True or False ==>The cash conversion cycle is calculated as: Top of Form Days in Inventory + Collection Period Days in Inventory – Payables Period Days in Inventory + Collection Period – Payables Period None of the above Bottom of Form A company can shorten its cash cycle by: Top of Form Reducing inventory turnover Reducing account payables Reducing days receivable None of the above Bottom of Form A company has a retention rate of 50%, sales of $25,000, beginning equity of $50,000 and profit margins of 10%, an asset turnover ratio of .75 and debt of $10,000. What is its sustainable growth rate? Top of Form 2.5% 1.7% 3.75% Not enough information given Bottom of Form Scenario analysis is a way of testing forecasts by changing one assumption at a time. Top of Form True False Bottom of Form Biases can and should always be eliminated in financial forecasts. Top of Form True False Bottom of Form Which of the following is commonly used in preparing pro forma statements: Top of Form Historical financial statements Projected sales Efficiency ratios All of the above Bottom of Form Pro forma statements are: Top of Form Summaries of historical financial statements Government-mandated analyses of financial statements Projected statements used in financial planning Estimated tax liabilities Bottom of Form Which of the following liabilities form part of a company’s “real” activities? I. Short-term debt II. Accounts payable III. Accrued operating expenses IV. Long-term debt Top of Form III only II and III I and IV I only Bottom of Form

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