Answered: To manage cash flow, you should _____…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question 12

Carla sells hot coffee, cider, and tea from a sidewalk cart near Wall Street in New York City. Last month she sold $4500 worth of product to 1000 customers. She spent $800 on buying her beverages in bulk. Her monthly costs are: Utilities=$100, Salary=$2000, Advertising=$0, Insurance=$0, Rent (cart)=$600, Depreciation=$0. Calculate Carla's average sale per customer.

Select one:

a.$5.00

b.$4.00

c.$4.50

d.$4.25

Question 13

Liabilities that will be paid over a period of more than one year are known as _____.

Select one:

a.long-term liabilities

b.equity

c.long-term assets

d.depreciating liabilities

Question 14

Question text

What business concept did Henry Ford introduce that forever changed American industry?

Select one:

a.assembly-line mass production

b.automobile manufacturing

c.a focus on quality

d.die-cast assembly

Question 15

Question text

Which of the following is the bottom line on a cash flow statement?

Select one:

a.net profit

b.taxes

c.ending cash balance

d.cost of goods sold

Question 16

Question text

Calculate the return on sales for a business that has net income of $25,000 and sales of $60,000.

Select one:

a.4.2 percent

b.42 percent

c.0.042

d.42

Question 17

Question text

Alexia owes her suppliers money, but a large number of her customers have not yet paid their bills. This is known as ______.

Select one:

a.a working capital

b.pilferage

c.a credit squeeze

d.burn rate

Question 18

Question text

Why is it best to pay expenses for your business with a check rather than with cash?

Select one:

a.a check can't be traced

b.a check provides written proof of payment

c.cash is easier to lose

d.cash is harder to deliver

Question 19

Question text

Aaliyah runs a pet store that caters exclusively to cats and dogs. A month into business, she gets a complaint that the store does not stock birdseed. In response, she adds bird and reptile supplies to her inventory. Is this a good decision?

Select one:

a.No; there is little money in other pet supplies.

b.No; this is unnecessary inventory for her store.

c.Yes; expansion is always good for business.

d.Yes; it is important to satisfy every customer.

Question 20

Question text

Which two categories below are used for business costs?

Select one:

a.Gross and net

b.Fixed and variable

c.Materials and labor

d.Wholesale and retail

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