55.A business might use _______________ to identify slow payers, who might then be referred to

55.A business might use _______________ to identify slow payers, who might then be referred to a ___________.
a.an ageing schedule of accounts receivable, collection agency
b.an ageing schedule of accounts receivable, credit agency
c.a pattern of credit sales receipts, collection agency
d.the average collection period, collection agency
56.Which of the following statements regarding the EOQ model are true?
I. The model assumes inventory is used up at a constant rate
II. The model assumes there is no buffer inventory (i.e. safety stock) required
III. Inventory should always be held at the constant level ‘E’, which minimizes the total cost of holding and ordering inventory
IV. The model identifies the order quantity which minimizes the total cost of holding and ordering inventory
a.I, II and IV
b.I and II
c.III and IV
d.II, III and IV
57.Which of the following can be considered forms of short term borrowing?
I. Debt factoring
II. Invoice discounting
III. Bank overdraft
a.I and II
b.I and III
c.II and III
d.I, II and III
58.In the context of business financing and in simple terms, gearing refers to
a.how much a business borrows compared with how much the business is financed with equity
b.the relationship between fixed costs and variable costs
c.the mix of internal and external sources of finance
d.the mix of short term and long term borrowing
59.The hidden costs associated with trade credit include which of the following:
I. Suppliers give higher priority to customers who make cash purchases
II. The cost of credit is often reflected in higher prices
III. Additional costs of monitoring invoices
a.II and III
b.I and II
c.I and III
d.I, II and III
60.
Jutry Limited is considering a change in credit policy which is expected to increase sales revenue from $240,000 to $368,000 and increase accounts receivable from $20,000 to $92,000 with all other working capital items unaffected. Jutry Limited requires a return of 13% on investments in working capital.
What is the minimum expected increase in profit necessary to justify the change in credit policy?