is likely to change as the size of the firm 15. When there are economies of scal
ID: 2802877 • Letter: I
Question
is likely to change as the size of the firm 15. When there are economies of scale, firm'si changes of scal e, a firm's a. days sales outstanding ratio b. total assets turnover ratio c. variable cost of goods sold ratio d. times interest earned ratio e. return on assets ratio 16. Considering each action independently and holding other things constant, which of the following reduces a firm's need for additional capital? a. An increase in the dividend payout ratio b. A decrease in the days sales outstanding c. A decrease in the profit margin d. An increase in expected sales growth e. A decrease in the accrual accounts (accrued wages and taxes)Explanation / Answer
Q15 Option C is correct. Economies of scale will impact variable cost to cost of goods sold ratio. Rest of the options are incorrect.
Q 16 Optino B is correct. A decrease in days sales outstanding increases collection from account receivables resulting in increase in available capital. Rest of options will result in decrease in available capital.
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