Better Inc, a US-based company, expects to receive €800,000 in two months’ time for consultancy services provided to the Austrian government. It wishes to be certain of the amount to be received and will use the derivatives market to achieve this.
Which one of the following actions should the company take NOW to hedge the risk?
A business holds an inventory item with an economic order quantity of 800 units. Supply lead times and usage rates for the item are as follows:
MaximumAverageMinimum
Supply lead time20 days12 days6 days
Daily usage25 units20 units10 units
The business wishes to avoid any risk of running out of this inventory item.
What is the size of the buffer inventory (using average figures) and the maximum level of inventory?
An analysis of the financial statements of Ordos Co revealed the following:
1. A higher than average inventory holding period
2. A lower than average acid-test ratio
3. A higher than average payment period for trade payables
4. A lower than average sales to fixed assets ratio
Which TWO of the above factors are consistent with overtrading?
The following comments were recently made, relating to methods of issuing shares by a public company:
1. An offer for sale is an invitation to the public to buy shares that are not yet in issue.
2. A placing is an invitation to selected investors to buy either new shares or shares already in issue.
Which ONE of the following combinations (true/false) is correct?
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