The ratios that are used to determine a company's short-term debt paying ability are:
A) asset turnover, times interest earned, current ratio, and account receivable turnover.
B) times interest earned, inventory turnover, current ratio, and accounts receivable turnover.
C) times interest earned, quick ratio, current ratio, and inventory turnover.
D) current ratio, quick ratio, account receivable turnover, and inventory turnover.
D
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Which of the following is an example of a contingent liability?
a. A liability for notes payable with interest included in the face amount. b. The liability for future warranty repairs on computers sold during the current period. c. A lawsuit pending against a restaurant chain for improper preparation of food. d. A corporate long-term employment contract with the chief executive officer.
If leadership has a low tolerance for ambiguity, the approval process is likely to be:
a. More rigorous b. More straightforward c. Quicker d. Lengthy
To determine whether a duty of care has been breached, a judge asks how a reasonable person would have acted in the same circumstances
a. True b. False Indicate whether the statement is true or false
Because of the worsening economic situation, your firm needs to drastically cut back, and downsize up to 40% of its workers. The firm has a reputation and tradition of being a firm that rewards the good skills and loyalty of its workers, and many have been with your firm for more than 30 years. The firm has been in your family for more than 100 years, and you are the 3rd generation CEO. Frankly,
what would help the most is to lay off all of those workers who are earning in excess of $80,000/year, retaining those who are earning between $40,000 and $50,000/year. That would reduce your overhead dramatically (and your health insurance costs). But almost all of the workers who earn in excess of $80,000 are age 50 or over, and unlikely to ever find comparable jobs elsewhere. Which of the following options would be consistent with your firm's core values and its long-term survival? a. downsize all workers making in excess of $80,000/year; since salary is the only consideration, the action is legal b. offer significant early retirement packages in exchange for a waiver of claims to workers earning in excess of $80,000/year; it may cost you in the short term, but it is consistent with your family's legacy and the firm's core values, and ultimately will help the firm's long-term survival c. do a targeted review of the skill sets of all employees, including those earning less than $80,000/year, to determine where there is an overlap and you can afford to let people go without damaging the firm's knowledge and skill base; downsize the people who are earning the most in each skill set, whatever their ages d. either b or c might be consistent with your core values and long-term survival