True or false: 1. The objective of a just-in-time inventory system is to totally

Question

True or false:

1. The objective of a just-in-time inventory system is to totally eliminate all inventories.

2.The primary difference between manufacturing companies and service companies is that the products provided by service companies are consumed immediately.

3. A corporation must record a liability for cash dividends on the date of record.

4. Stock of a closely-held corporation does not trade on a stock exchange.

5. A banker may perform a financial ratio analysis to assess a firm's ability to repay debt in a timely manner.

Explanation / Answer

1. FALSE,ITS AIM IS TO ELIMINATE ALL ERRORS NOT INVENTORIES.

2.TRUE AS SERVICES ARE PRODUCED AND CONSUMED IN SAME PERIOD OF TIME

3. FALSE AS THERE IS NO ENTRY FOR RECORD OF LIABILITY

4.  TRUE because the small number of owners rarely sell their shares

5. TRUE

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