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The basic principles of commodity trading
0commodity trading
Commodity Trading is the trading in derivatives, where goods are traded refers to the bulk trade in the stock market. Bullion generally traded energy, metals and agricultural products on the market for raw materials. Derivatives is a form of financial security whose price is dependent on conditions or derivatives of one or more underlying assets. The active derivative is in the form of shares and corporate bonds, commodities and currencies of various countries. Commodity trading refers mainly to trade, where investors buy or sell goods through future transactions or contracts.
A Future is a futures contract that the delivery of a commodity at a specified price at a later date set or predetermined requires. In this case the buyer is bound by the terms of the contract. The buyer and seller have the option to place their positions before the expiry of the contract is subject to other conditions that govern every market. Although the business model is the product share very similar to trading, it is about lower margins and it is much easier to understand. A commodities trader can use products such as gold and grain, start the lure very low margins. The time for stretching goods trding morning at 10 clock midnight. It is therefore possible to trade by the end of the dayRequirements -. Physically and mentally
search opens a broker / sub-broker account to trade commodities. The broker with the economic situation of the person is satisfied, they can ask to see the card, demat account, bank account and the margin money account opening with him. After completion of these formalities, the person authorized to trade in commodities. Margin is the first payment to the broker, before taking a position on the market. Since the activity of stock trading requires trade of goods of accessibility of information and liquidity facility. The operator can easily reduce the risk through effective diversification. Negotiation strategies are low-risk coverage gaps and to place arbitration term. The trader can take advantage of low margins and take calls Directional Markets. The market is diverse in nature, and is suitable for day traders / speculators, long-term investor, hedger and arbitrageur.
Risk and ReturnHigher yields a risk as high, so that the yield is low risk. Based on the appetite for risk and return, then the merchant will receive benefits or returned. Trade in goods is essentially the futures, to leveraged positions. For this reason, mostly rich merchants and knowledgeable landscape on the market goods. The risk is as a result of an investment, the input of good exit strategy, and ability to protect the loss. Uncertainties and risks are part of all derivatives markets and risk factors in the futures market, similar to stock futures trading markets. The main difference is that the availability of information on the fluctuations of supply and demand in the commodity markets may not be as difficult as the stock market. The return of the market for raw materials is also nice if the negotiating strategy of the operator worked correctly. Understanding of the fundamental and technical factors of the global and domestic economy contributes to higher yields of commodity trading. Inflation is the big problem in today’s economy is a commodity the right tool for asset allocation, inflation risk plays. Commodities are a hedge against inflation, because unlike stocks, commodity prices move in tandem with inflation. In addition, the purchase of products that your investment truly global and there are no problems with the management company or the cash flows involved, to offer all products, adjust the application of trade and pure.
Clearing and SettlementTrading
supply base is becoming increasingly popular. Each contract has varied a lot and the size of the delivery of real estate assets. Market participants are subject to a quantity and price of the contract, like all other parameters are negotiated through the exchange set. It is delivered in paper form and, at the request of the operator with the accession number organization materialized again.
ConclusionThe markets are alive and dynamic. A systematic and careful movement will be a good trader. Patience, discipline and knowledge are important qualities to develop commercially successful and profitable product.
Commodity Trading
Where can I get information online of basic accounting and financial principles?
01 year ago
by admin
in Accounting
Question : Where can I get information online of basic accounting and financial principles?
financial accounting online
Best answer:
Answer by unan1m0us
search yahoo or google….
How to Get Out of Debt, Stay Out of Debt, and Live Prosperously: *(Based on the Proven Principles and Techniques of Debtors Anonymous)
51 year ago
by admin
in Scholarships
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This book is neither sponsored nor endorsed by Debtors Anonymous. A recovered debtor, the author is intimately familiar with the success of the Debtors Anonymous program.Millions of consumers have become trapped in a spiral of debt, but there is hope. If you wants to free yourself from the shackles of debt, this book is for you–it can help you “get out of debt, stay out of debt, and live prosperously.” Jerrold Mundis writes in a friendly, engaging style, urging readers to stop the cycle of spending. Mundis knows what he’s talking about–he, too, was once thousands of dollars in debt and didn’t know where to turn. Anecdotes from Debtors Anonymous folks, plus multiple examples from the writer’s own life and ledgers, make How to Get Out of Debt an encouraging read, not a condescending one. Once you start your program, you may want to periodically reread some chapters for inspiration–and fun.
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Marine Insurance: Its Principles And Practice
0
Many of the earliest books, particularly those dating back to the 1900s and before, are now extremely scarce and increasingly expensive. We are republishing these classic works in affordable, high quality, modern editions, using the original text and artwork.
List Price: $ 26.95
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The basic principles of joint savings accounts
0marriage is the most basic of life together. We commit ourselves to live like us, when we do our vows. In the modern world, often through the merger of two companies and projects. Many couples struggle for the division of their assets. Most couples decide whether to open at least one joint account. In fact, it is one of the most popular brands of marriage in the modern world. However, the joint accounts were not always the best idea. Here are a few things to consider> to. ‘/ P> A joint savings account must be opened, if the relationship is to be very stable. A new marriage is of course always stable on the surface, but today more and more unmarried couples agreed to merge their finances, before he entered into the marriage. It is almost always a bad idea, unless the relationship is very stable and is also seeking for other forever. A joint account can make life a little easier, but if something goes wrong, the account can be very painful for both parties.
often one partner is running the account, while the other without. In this sense, we, the provisions on the fact that large withdrawals can be made with the consent of both parties. Although no one to look like a break, the truth is that there is more than likely to stay together separately. open If you are a joint account, you must ensure that you inform each other about the status of the account. Many couples in financial trouble because they do not communicate. It is a good idea, a single register, kept and updated daily, so that everyone knows exactly what is on the account. When it comes to access to account, there are several options available. The two basic forms are “either” and “both.” With either option, both parties may make separate transactions on the other side. In option two,> parties must sign the transaction. Although option two is suffering from convenience, it is much safer if something goes wrong. Before opening the account, the couple should have a good discussion on the account. You should discuss exactly how the account will be used and how and how much money will be deposited. You should also discuss how they monitor the account and ensure that they on the same sheet of music. Problems can occur if the couple do not share common financial practices. It is possible that one party is responsible for monitoring the account, but the other person must undertake to inform the recording devices for all transactions that they do. joint bank accountsexist because of their convenience, but they can also become a burden when things are not handled carefully. Both parties must have clear expectations of how the bill will be used and funded. While we respect and responsibility, a joint account can be a good step in a relationship.
Joint accounts
A Return to Abundance, Book 3: Money management, personal finance education, budgeting, financial planning, time value of money principles, cash flow principles, budget worksheets: a self-help book
11 year ago
by admin
in Financial Management
Master the Fundamentals of Money and Learn to Make Wise Financial Desicions
Much of what we do with and for our money is determined by beliefs as old as money itself–beliefs of which we are often unaware. Societal forces sanction those ancient beliefs, and our families of origin unwittingly grant them the kind of power only unexamined beliefs can have: the power to act contrary to our stated intentions.
A Return to Abundance, Book III will teach you the fundamentals of money in a user friendly, easy to follow format. You will master the core skills of calculating the time value of money, learn the principles of cash flow management, and through the story of the lives of two different couples covering 40 years of their lives you will appreciate the power of the principles you’ve just mastered.
You can make wise financial decisions. Read A Return to Abundance, Book III , practice the skills taught therein, and you will master the fundamentals of money. ( color book, 166 pages, 5.5×8.5 format, paperback)
Change your life… and change the world.
Other books in this series:
A Return to Abundance, Book I
A Return to Abundance, Book II
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Networking Principles Question?
01 year ago
by admin
in Accounting
Question : Networking Principles Question?
A small research company in Pittsburg is working to develop a new method of mass storage to replace a current hard drive technology. Four engineers and an office manager work there. The engineers are highly skilled professionals, and the office manager is a capable computer user. The company has an always-on Internet connection because employees must conduct research frequently. The employees have hopes of making a breakthrough and bringing the company public within the next two years. You have been hired as a security consultant to assess the company’s need. Write a paper recommending what type of security policy should be used (open, moderately restrictive, or highly restrictive) and what security technologies should be in place. On what areas should security policy focus (physical security, data security, auditing, passwords, and so forth) and what technologies should be used to secure those areas.
physical security audit
Best answer:
Answer by molasses2
Here are a few things to think about. Since the company is small, cost may be a significant factor. However, since they are working on a groundbreaking project, it is possible that many people would be interested in stealing it, so the more difficult their security is to breach, the better. And since the company is made up of people who are comfortable with technology, a very restrictive security system would not be too difficult for them to learn and bear with.
Physical security could probably be kept fairly minimal. Since all the employees will know each other, a security guard probably isn’t necessary, although keeping the servers behind lock and key will be a must. Rotating passwords and/or a token/PIN system, encrypted hard drives on all workstations, and maybe even some biometrics could be useful.
Those are just a few things to think about. I can’t do ALL the work…
The basic principles of commodity trading
0 Commodity Trading Commodity Trading is the trading of commodity derivatives, where the product refers to all goods traded in bulk on the stock market. Bullion Generally, energy, metals and agricultural products in the market trading of commodities. Derivatives are a type of financial assurance, which depend on prices or derived from one or more underlying securities. Derivative assets may take the form of shares and corporate bonds, commodities and currencies of various countries. Commodity Trading reason for trade, as investors buy or sell goods or future transactions on contracts. A Future is a futures contract that requires delivery of a commodity at a specified price at some specified time or not. In this case, the buyer is obliged to comply with the terms of the contract. Buyers and sellers have the opportunity to square their positions before the expiry of the contract is subject to different conditions for each contract. Although the business model of commodities is quite similar to trading shares, it means lower margins and is much easier to understand. Commodity traders of commodities like gold and grains, start the lure of very low margins. In addition, the deadline for the product range of clock 10 trding morning to midnight. It is therefore possible, at the end of the day to trade day. need – physically and mentally Find open a broker or sub-broker account to trade in goods. The dealer, if the economic efficiency of the person who is happy to ask them, demat pan card account, bank accounts and margin money for opening an account with him. Allowed After these formalities, the person for Commodity Trading. The margin is the money in advance to pay broker, before taking a position in the marketplace. As the trading activity of shares requires the negotiation of products offering easy access to information and liquidity facility. The merchant can easily reduce risk through effective diversification. The trading strategies with deviations at low risk include both delivery and ultimately arbitration instead. The operator can take advantage of low margins and take calls directional markets. The market is diverse in nature, and it is suitable for day traders and speculators, long-term investor, hedging and arbitrage. Risks and
Accounting Principles
0Question 1:
Under generally acceptable accounting principles, it is possible for two companies with identical operating results may not report identical net incomes.
Answer: false
Question 2:
Ratios are used to compare different firms in the same industry.
True- used to compares firm in an industry and also changes over time
Answer: True:
Question 3:
Profitability ratios are distorted by inflation because profits are stated in current dollars and assets and equity are stated in historical dollars.
Answer: True:
Question 4:
A firm with heavy long-term debt can benefit during inflationary times, as debt can be repaid with “cheaper” dollars.
True- example if a firm borrows 10 million today, this amount is relatively high today, if there is inflation this means prices go up, if there is inflation then this means that this amount will be look small when the firm repays
Answer: True:
Question 5:
Debt utilization ratios are used to evaluate the firm’s debt position with regard to its asset base and earning power.
False- debt utilisation show level of assets financed through debt
Answer: false
Question 6:
The statement of cash flows helps measure how the changes in a balance sheet were financed between two time periods.
Answer: True:
Question 7:
Net working capital is the difference between current assets and current liabilities.
Working capital = CA – CL
Answer: True:
Question 8:
Depreciation is an accounting entry and does not involve a cash expense.
Answer: True:
Question 9:
Total assets of a firm are financed with liabilities and stockholders equity.
True- finance using debt or equity
Answer: True:
Question 10:
Sales minus operating costs = operating income.
Answer: True:
Question 11:
Shop-Til-You-Drop Inc. recently reported net income of $5. 2 million and depreciation of $600,000. What is was net cash flow? (Assume it has no amortization expense. )
Net cash flow = net income + depreciation + amortisation
Net cash flow = 5. 2m+0. 6m=5. 8 million
Answer: 5. 8 million
Question 12:
Temple Square Inc. reported that its retained earnings for 2005 were $490,000. In its 2006 financial statements, it reported $60,000 of net income, and it ended 2006 with $510,000 of retained earnings. How much were paid as dividends to shareholders during 2006?
2005 retained earnings = 490,000
2006 net income = 60,000
2006 retained earnings = 510,000
Earnings available for pay out in 2006 = 490,000 + 60,000 = 550,000
If dividends were not paid reined earnings would be 550,000
Dividends = 550,000 – 510,000 = 40,000
Answer 40,000
Question 13:
Fine Breads Inc. paid out $26,000 common dividends during 2005, and it ended the year with $150,000 of retained earnings. The prior year’s retained earnings were $145,500. What was the firm’s 2005 net income?
2004 retained earnings = 145,000
Dividends 2005=26,000
2005 retained earnings = 150,000
Change in retained earnings = 150,000 – 145,000 = 5,000
Net income 2005 = change in retained earnings + dividends
Net income = 5,000 + 26,000 = 31,000
Answer 31,000
Question 14:
Which of the following items is NOT included in current assets?
A. Accounts payable
B. Inventory
C. Accounts receivable
D. Cash
E. Short-term, highly liquid, marketable securities
Answer: Accounts payable
Question 15:
Other things held constant, which of the following actions would increase the amount of cash on a company’s balance sheet?
A. The company issues new common stock.
B. The company repurchases common stock
C. The company pays a dividend.
D. The company purchases a new piece of equipment
E. The company gives customers more time to pay their bills
Answer: The Company issues new common stock.
Question 16:
Miller Metals recently reported $9,000 of sales, $6,000 of operating costs other than depreciation, and $1,500 of depreciation. The company had no amortization charges, it had $4,000 of bonds that carry a 7% interest rate, and its federal-plus-state income tax rate was 40%. What was its net cash flow?
Net cash flow = net income + amortisation + depreciation
Net income = sales – operating costs – depreciation – interest – tax
Net income =9000 – 6000 – 500 – (4,000*7%) – tax
Net income =2500 – 280 – tax
Net income =2220– tax
Tax = 2220*40%=888
Net income =2220– 888=1332
Net cash flow = net income + amortisation + depreciation
Net cash flow = 1332+280+500=2112
Answer: 2112
Question 17:
Which of the following statements is CORRECT?
1. The statement of cash flows shows where the firm’s cash is located, with a listing of all banks and brokerage houses where cash is on deposit.
2. The statement of cash flows for 2005 shows how much the firm’s cash (the total of currency, bank deposits, and short-term liquid securities, or cash equivalents) increased or decreased during 2005.
3. The statement of cash flows reflects cash flows from operations and from borrowings, but it does not reflect cash obtained by selling new common stock.
4. The statement of cash flows reflects cash flows from operations, but it does not reflect the effects of buying or selling fixed assets.
5. The statement of cash flows reflects cash flows from continuing operations, but it does not reflect the effects of changes in working capital.
Answer: The statement of cash flows for 2005 shows how much the firm’s cash (the total of currency, bank deposits, and short-term liquid securities, or cash equivalents) increased or decreased during 2005.
Question 18:
Which of the following statements is CORRECT?
1. In the statement of cash flows, depreciation charges are reported as a use of cash.
2. In the statement of cash flows, a decrease in accounts receivable is reported as a use of cash.
3. In the statement of cash flows, a decrease in inventories is reported as a use of cash.
4. In the statement of cash flows, a decrease in accounts payable is reported as a use of cash.
5. Dividends do not show up in the statement of cash flows because dividends are considered to be a financing activity, not an operating activity.
Answer: In the statement of cash flows, a decrease in accounts payable is reported as a use of cash.
Question 19:
Which of the following statements is CORRECT?
1. Depreciation reduces a firm’s cash balance, so an increase in depreciation would normally lead to a reduction in the firm’s net cash flow.
2. Net cash flow (NCF) is defined as follows:
Net Cash Flow = Net Income + Depreciation and Amortization Charges.
3. Depreciation and amortization are not cash charges, so neither of them has an effect on a firm’s reported profits.
4. The more depreciation a firm reports, the higher its tax bill, other things held constant.
5. People sometimes talk about the firm’s net cash flow, which is shown as the bottom entry on the income statement, as the “bottom line. ”
Answer: Net cash flow (NCF) is defined as follows:
Net Cash Flow = Net Income + Depreciation and Amortization Charges.
Question 20:
Last year Aldrin Company’s operations provided a negative net cash flow, yet the cash shown on its balance sheet increased. Which of the following statement could explain the increase in cash, assuming the company’s financial statements were prepared under generally accepted accounting principles?
1. The company retired a large amount of its long-term debt.
2. The company repurchased some of its common stock.
3. The company sold some of its fixed assets.
4. The company had high depreciation expenses.
5. The company dramatically increased its capital expenditures.
Answer: The Company repurchased some of its common stock.
Question 21:
Analysts who follow Sierra Nevada Inc. recently noted that, relative to the previous year, the company’s operating net cash flow increased, yet cash as reported on the balance sheet declined. Which of the following factors could explain this situation?
1. The company sold a division and received cash in return.
2. The company cut its dividend.
3. The company made a large investment in a new plant.
4. The company issued new long-term debt.
5. The company issued new common stock.
Answer: The Company issued new common stock.
Question 22:
Last year, Owen Technologies reported (1) a negative net cash flow from operations, (2) a negative free cash flow, and (3) an increase in cash as reported on its balance sheet. Which of the following factors could explain this situation?
1. The company had a sharp increase in its depreciation and amortization expenses.
2. The company had a sharp increase in its inventories.
3. The company sold a new issue of common stock.
4. The company had a sharp increase in its accrued liabilities.
5. The company made a large capital investment early in the year.
Large investment- reduces free cash flow and net cash flow, investment may have been financed by debt therefore no change in cash
Answer: The Company made a large capital investment early in the year
Question 23:
On its 2004 balance sheet, Sherman Books showed $510 million of retained earnings, and exactly the same amount was shown the following year. Assuming that no earnings restatements were issued, which of the following statements is CORRECT?
1. The company definitely had zero net income in 2005.
2. The company must have paid no dividends in 2005.
3. Dividends could have been paid in 2005, but they would have had to equal the earnings for the year.
4. If the company lost money in 2005, they must have paid dividends.
5. The company must have paid out half of its earnings as dividends.
Answer: statement 3: Dividends could have been paid in 2005, but they would have had to equal the earnings for the year.
Question 24:
Which of the following statements is CORRECT?
1. Accounts receivable are reported as a current liability on the balance sheet.
2. Dividends paid reduce the net income that is reported on a company’s income statement.
3. If a company uses some of its bank deposits to buy short-term, highly liquid marketable securities, this will cause a decline in its current assets as shown on the balance sheet.
4. If a company issues new long-term bonds during the current year, this will increase its reported current liabilities at the end of the year.
5. If a company pays more in dividends than it generates in net income, its retained earnings as reported on the balance sheet will fall.
Answer: Statement 5: If a company pays more in dividends than it generates in net income, its retained earnings as reported on the balance sheet will fall.
Question 25:
Cox Corporation reported EBITDA of $22. 5 million and $5. 4 million of net income. The company has a $6 million interest expense and its corporate tax rate is 35%. What was Cox’s depreciation and amortization expense?
EBITDA= $22. 5 million
Net income =5. 4 million
Interest expense=6 million
Corporate tax rate= 35%
Depreciation + amortization=Y
Net income = EBITDA – tax – depreciation – amortisation- interest – tax
Calculations:
Tax expenses = 35% X (EBITDA – interest expenses- Y (depreciation and amortisation)
Tax expenses = 35% X (22. 5m – 6m- Y)
Net income = EBITDA – tax – depreciation – amortisation- interest – tax
5. 4 = 22. 5 – [35% X (22. 5 – 6- Y)] – Y- 6
5. 4 = 16. 5 – [35% X (16. 5- Y)] – Y
5. 4 = 16. 5 – [5. 775- 0. 35Y] – Y
5. 4 = 16. 5 – 5. 775+ 0. 35Y – Y
5. 4 = 10. 725 + 0. 35Y – Y
0. 65Y= 5. 325
Depreciation and amortization expense =Y= 8. 19million
Answer = 8. 19 million
Question 26:
Byrd Lumber has 2 million shares of common stock outstanding that sell for $15 a share. If the company has $40 million of common equity, what is the company’s Market Value Added (MVA)?
Market value added = value of the firm in the market – capital invested in the firm
Market value added = (2 million X 15) – 40 million
Market value added = -30,000
Answer: Market value added = -30,000
Question 27:
Hybrid Battery Systems recently reported $9,000 of sales, $6,000 of operating costs other than depreciation, and $500 of depreciation. The company had no amortization charges, it had $4,000 of bonds that carry a 7% interest rate, and its federal-plus-state income tax rate was 40%. In order to sustain its operations and thus generate sales and cash flows in the future, the firm was required to make $800 of capital expenditures on new fixed assets and to invest $500 in net operating working capital. By how much did the firm’s net income exceed its free cash flow?
Net income = sales – operating costs – depreciation – interest – tax
Net income =9000 – 6000 – 500 – (4,000*7%) – tax
Net income =2500 – 280 – tax
Net income =2220– tax
Tax = 2220*40%=888
Net income =2220– 888=1332
Free cash flow = net income + amortisation + depreciation-change in working capital
Free cash flow = 1332+280+500=2112
Difference between free cash flow and net income=2112-1332=780
Answer =-780
Question 28:
Ramala Corp’s sales last year were $48,000, and its total assets were $25,500. What was its total assets turnover ratio (TATO)?
Asset turnover ratio = sales/ assets
Asset turnover ratio =48000/25500
Asset turnover ratio =1. 8824
Answer: 1. 8824
Question 29:
Roberts Corp’s sales last year were $300,000, and its net income after taxes was $25,000. What was its profit margin on sales?
Profit margin = income after tax/ sales
Profit margin = 25000/300000
Profit margin=0. 0833 = 8. 33%
Answer: 8. 33%
Question 30:
Reynolds Corp’s total assets at the end of last year were $300,000 and its net income after taxes was $25,000. What was its return on total assets?
Returns on total assets = income after tax/ assets
Returns on total assets =25,000/300,000, Returns on total assets =0. 0833 = 8. 33%
Answer: 8. 33%
Question 31:
Rutland Corp’s stock price at the end of last year was $30. 25 and its earnings per share for the year were $2. 45. What was its P/E ratio?
P/E ratio = price per share / earnings per share
P/E ratio = 30. 25/2. 45
P/E ratio = 12. 347
Answer: 12. 347
Question 32:
Rand Corp’s stock price at the end of last year was $40. 00, and its book value per share was $24. 50. What was its Market/Book ratio?
Market/Book ratio= market value/ book value
Market/Book ratio= 40/ 24. 5
Market/Book ratio= 1. 6327
Answer: 1. 6327
Question 33:
Rolle Corp has $500,000 of assets, and it uses no debt–it is financed only with common equity. The new CFO wants to employ enough debt to bring the Debt/Assets ratio to 45%, using the proceeds from the borrowing to buy back common stock at its book value. How much must the firm borrow to achieve the target debt ratio?
Debt ratio = debt/total assets
Required debt ratio = 0. 45 or 60%
Debt ratio = 0. 45 = [x / 500,000]
Where x is amount of debts
Solution for x:
0. 6 = [x / 500,000]
300,000 = x
X = 300,000
Answer: borrowing should be 300,000
Question 34:
Rull Corp’s assets are $500,000, and its total debt outstanding is $200,000. The new CFO wants to employ a debt ratio of 60%. How much debt must the company add or subtract to achieve the target debt ratio?
Debt ratio = debt/total assets
Rull debt ratio = 200,000/500,000 = 0. 4 or 40%
Required debt ratio = 0. 6 or 60%
In order to increase debt ratio debts should be increased:
Debt ratio = 0. 6 = [200,000 + x / 500,000]
Where x is amount of debts to increase
Solution for x:
0. 6 = [200,000 + x / 500,000]
300,000 = 200,000 + x
X = 100,000
Answer: increase debt by 100,000
Question 35:
Rangoon Corp’s sales last year were $400,000, and its year-end total assets were $300,000. The average firm in the industry has a total assets turnover ratio (TATO) of 2. 5. The new CFO believes the firm has excess assets that can be sold so as to bring the TATO down to the industry average without affecting sales. By how much must the assets be reduced to bring the TATO to the industry average?
Industry asset turnover =2. 5
Asset turnover = sales/ total assets
Rangoon asset turnover = 400,000/300,000 = 1. 333333
To achieve industry average then:
Rangoon asset turnover = [400,000/ (300,000 – x)] = 2. 5
Where x is the amount of assets to be sold
Solution for x:
[400,000/ (300,000 – x)] = 2. 5
400,000 = 750,000 – 2. 5 x
2. 5x = 350,000
X = 140,000
Answer: assets should be reduced by 140,000
Question 36:
Considered alone, which of the following would increase a company’s current ratio?
Current ratio = current assets/ current liabilities,
Current ratio will increase if current assets increase or current liabilities decrease
Answer: Increase in current assets or decline in current liabilities
