Part 5
User
Brooke B Hewitt
Course
BA 520: Financial Strat/Tech(68796-W15)
Test
Part 5 Quiz
Started
1/13/15 2:46 PM
Submitted
1/14/15 2:48 PM
Status
Completed
Attempt Score
75 out of 75 points
Time Elapsed
24 hours, 1 minute.
Instructions
Question 1
3 out of 3 points
A rapid build-up of inventories normally requires additional financing, unless the increase is matched by an equally large decrease in some other asset.
Correct Answer: True
Question 2
3 out of 3 points
As a firm's sales grow, its current assets also tend to increase. For instance, as sales increase, the firm's inventories generally increase, and purchases of inventories result in more accounts payable. Thus, spontaneous liabilities that reduce AFN arise from transactions brought on by sales increases.
Correct Answer: True
Question 3
3 out of 3 points
If a firm wants to maintain its ratios at their existing levels, then if it has a positive sales growth rate of any amount, it will require some amount of external funding.
Correct Answer: False
Question 4
3 out of 3 points
One of the first steps in arriving at a firm's forecasted financial statements is a review of industry-average operating ratios relative to these same ratios for the firm to determine whether changes to the ratios need to be made.
Correct Answer: True
Question 5
3 out of 3 points
One of the necessary steps in the financial planning process is a forecast of financial statements under each alternative version of the operating plan in order to analyze the effects of different operating procedures on projected profits and financial ratios.
Correct Answer: True
Question 6
3 out of 3 points
Firms with high capital intensity ratios have found ways to lower this ratio permitting them to achieve a given level of growth with fewer assets and consequently less external capital. For example, just-in-time inventory systems, multiple shifts for labor, and outsourcing production are all
Brooke B Hewitt
Course
BA 520: Financial Strat/Tech(68796-W15)
Test
Part 5 Quiz
Started
1/13/15 2:46 PM
Submitted
1/14/15 2:48 PM
Status
Completed
Attempt Score
75 out of 75 points
Time Elapsed
24 hours, 1 minute.
Instructions
Question 1
3 out of 3 points
A rapid build-up of inventories normally requires additional financing, unless the increase is matched by an equally large decrease in some other asset.
Correct Answer: True
Question 2
3 out of 3 points
As a firm's sales grow, its current assets also tend to increase. For instance, as sales increase, the firm's inventories generally increase, and purchases of inventories result in more accounts payable. Thus, spontaneous liabilities that reduce AFN arise from transactions brought on by sales increases.
Correct Answer: True
Question 3
3 out of 3 points
If a firm wants to maintain its ratios at their existing levels, then if it has a positive sales growth rate of any amount, it will require some amount of external funding.
Correct Answer: False
Question 4
3 out of 3 points
One of the first steps in arriving at a firm's forecasted financial statements is a review of industry-average operating ratios relative to these same ratios for the firm to determine whether changes to the ratios need to be made.
Correct Answer: True
Question 5
3 out of 3 points
One of the necessary steps in the financial planning process is a forecast of financial statements under each alternative version of the operating plan in order to analyze the effects of different operating procedures on projected profits and financial ratios.
Correct Answer: True
Question 6
3 out of 3 points
Firms with high capital intensity ratios have found ways to lower this ratio permitting them to achieve a given level of growth with fewer assets and consequently less external capital. For example, just-in-time inventory systems, multiple shifts for labor, and outsourcing production are all