5. (TCO 2) Which of the following statements is false? Select all that apply: (Points: 3), The optimal credit policy minimizes the total cost of granting credit. , Firms should avoid offering credit at all cost. , An increase in a firm’s average collection period generally indicates that an increased number of customers are taking advantage of the cash discount. , The costs of the credit application process and the costs expended in the collection process are carrying costs of granting credit. , Character refers to the ability of a firm to meet its credit obligations out its operating cash flows. ,,,6. (TCO 2) You place an order for 100 units of inventory Part A at a unit price of $522. The supplier offers terms of 3/25, net 40. How much should you remit if you take the discount? (Points: 3), $52,200 , $50,634 , $51,678 , None of the above ,,,7. (TCO 2) Auto Parts sells 1,600 electric parts per week and then reorders another 1,600 parts. If the relevant carrying cost per electric part is $4 and the fixed order cost is $650, what is the total carrying cost and the restocking cost, respectively? (Points: 3), $6,400 and $33,800 , $3,200 and $33,800 , $6,400 and $7,800 , $6,400 and $33,000 , None of the above ,,,8. (TCO 2) Company ABC has expected sales of 12,000 units this year, an ordering cost of $6 per order and carrying costs of $1.60 per unit. What is the average inventory? (Points: 3), 310 units , 300 units , 150 units , 155 units , None of the above ,,,9. (TCO 2) The ___________ is the time that elapses between the sale of an item and the receipt of payment for that sale. (Points: 3), accounts receivable period , accounts payable period , cash cycle , customer operating cycle , None of the above ,,,10. (TCO 2) List three examples of short-term borrowing. (Points: 3)
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