Karl Mathers set up a new company and obtained loans to buy inventory with the intention of filing for bankruptcy after 2 years and selling the inventory later to a close friend at deep discounts. What is the term for this type of bankruptcy fraud?
a. Commercial loan fraud
b. Inventory dumping fraud
c. Bust-out
d. None of the above
c
FEEDBACK: a. Incorrect.
b. Incorrect.
c. Correct. This is an example of a bust-out or planned bankruptcy.
d. Incorrect.
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Last year Central Chemicals had sales of $205,000, assets of $127,500, a profit margin of 5.3%, and an equity multiplier of 1.2. The CFO believes that the company could reduce its assets by $21,000 without affecting either sales or costs. Had it reduced its assets in this amount, and had the debt-to-assets ratio, sales, and costs remained constant, by how much would the ROE have changed?
A. 1.81% B. 2.02% C. 2.22% D. 2.44% E. 2.68%
The following sentence is an example of effective business writing: As per your request, further instructions will be sent to you under separate cover
Indicate whether the statement is true or false
List and describe the six steps of a formal decision-making process.
What will be an ideal response?
Exchange rates, inflation, and education level of the workforce are examples of which of the following environmental factors?
A. Cultural B. Economic C. Security D. Legal/political E. Infrastructure