Financial CABM Dumps PDF Free Download - Page: 7

QUESTION: 49

The average length of time between the purchase of raw materials and labor and the payment of cash for them is called:

Accounts payable period
Capital investment cycle
Payable deferral period
Purchase goods duration

Answer(s): C

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QUESTION: 50

The formula to calculate the Cash conversion cycle is:

Cash Conversion Cycle = (Cash conversion period) + (Receivables conversion period) (Payable deferral period)
Cash Conversion Cycle = (Inventory conversion period) + (payables conversion period) (receivables deferral period)
Cash Conversion Cycle = (Receivables conversion period) + (Payable deferral period)
- (Inventory conversion period)
Cash Conversion Cycle = (Inventory conversion period) + (Receivables conversion period) (Payable deferral period)

Answer(s): D

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QUESTION: 51

What calls for matching asset and liability maturities?

Short-term financing
Self-liquidating approach
Long-term financing
Equity spontaneous approach

Answer(s): B

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QUESTION: 52

When finances all of the temporary assets with short-term, non-spontaneous debt and finances its fixed assets with long-term capital, this leads to:

Aggressive approach
Long vs. short term debt
Conservative approach
Debt financing approach

Answer(s): A

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QUESTION: 53

The aggressive policy calls for the greatest use of long-term debt, while the conservative policy requires the least, maturity matching falls in between.