Why are accruals called spontaneous sources of funds, what are their costs, and why dont firms use

Question:

Why are accruals called spontaneous sources of funds, what are their costs, and why don’t firms use more of them?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Fundamentals of Financial Management

ISBN: 978-0324664553

Concise 6th Edition

Authors: Eugene F. Brigham, Joel F. Houston

See More Books

Question Posted: Oct 05, 2011 09:52 AM

See More Questions

What are the two major sources of spontaneous short-term financing for a firm? How do their balances behave relative to the firms sales?
Why are mutual funds and exchange-traded funds called financial intermediaries? Why does it make sense for an individual to invest her savings in a mutual fund or ETF rather than directly in...
Why are more funds from property and casualty insurance companies than funds from life insurance companies invested in the money markets?
Explain these points in detail w.r.t application of control in auditing with examples. 1: Relate data capture control with internal control in auditing with example 2: Relate validation control with...
McDougan Associates, a U.S.-based investment partnership, borrows 80,000,000 at a time when the exchange rate is $1.3460/. The entire principal is to be repaid in three years, and interest is 6.250%...
How can organizations foster a culture of diversity, equity, and inclusion within teams, proactively addressing systemic biases and promoting equitable access to opportunities for professional growth...
In an earlier SIOP salary survey (Katkowski \& Medsker, 2001), 73 of the respondents ( 33 males, 40 females) received their master's degrees in the 10 -year period from 1991 to 2000. Listed below are...
Renfro, Inc. was franchised on January 1, 2016. At the end of its third year of operations, December 31, 2018, management requested a study to determine what effect different materials inventory...
Futura Company purchases the 4 0 , 0 0 0 starters that it installs in its standard line of farm tractors from a supplier for the price of $ 8 . 4 0 per unit. Due to a reduction in output, the company...
Zambrano Wholesale Corporation maintains its records on a cash basis. At the end of each year the company's accountant obtains the necessary information to prepare accrual basis financial statements....
Define each of the following loan terms, and explain how they are related to one another: the prime rate, the rate on commercial paper, the simple interest rate on a bank loan calling for interest to...
Indicate using a (+), (-), or (0) whether each of the following events would probably cause accounts receivable (A/R), sales, and profits to increase, decrease, or be affected in an...
Set up an integral that represents the area of the surface obtained by rotating the given curve about the -axis. Then use your calculator to find the surface area correct to four decimal places. (a)...
Sketch, and explain the main features of, a profit-volume chart.
What is the average tax rate paid by a single person with an$60,000 adjusted gross income for 2008?
Compare renting movies from a box store, versus mail, versus streaming. How does each successive model eliminate value-chain activities?
When the Giants and Patriots football teams play each other, can one of the quarterbacks have a higher passing percentage in each half while having a lower passing percentage for the entire game?
N = 150, n = 20, k = 30, x = 5 A hypergeometric probability experiment is conducted with the given parameters. Compute the probability of obtaining x successes.
Solmere Capital is considering investing in an open-cut coal mine close to a regional town with a population of 1200 people. The mine will create up to 1500 new jobs in the region and will facilitate...
Q1) What is the a3 Value Q2) What is the a7 Value Q3) What is the a4 Value Q4) What is the b3 Value Q5) What is the b2 Value Q6) What is the sign of 2nd constraint? A pastry chef at a bakery wants to...
For the reaction Ca 3 P 2 + H 2 O Ca(OH 2 ) + PH 3 , (a) Balance the equation. (b) How many grams of H 2 O would you need to react with 60.0 g of Ca 3 P 2 ? (c) How many grams of PH 3 could...
Superior Cement Company has an 8 percent preferred stock issue outstanding, with each share having a $100 face value. Currently, the yield is 10 percent. What is the market price per share? If...
The stock of the Health Corporation is currently selling for $20 a share and is expected to pay a $1 dividend at the end of the year. If you bought the stock now and sold it for $23 after receiving...
Delphi Products Corporation currently pays a dividend of $2 per share, and this dividend is expected to grow at a 15 percent annual rate for three years, and then at a 10 percent rate for the next...
The veterinarian suspects a bleeding disorder in a young mixed breed dog. He requests that you perform a BMBT test on the dog. What other piece of information is necessary with any coagulation test?
.. Evaluate the following integrals: a) / b) c) d) x4 dx x-1 5x+1 dx (2x+1)(x-1) x3+4x+x-1 .3 x3 + x2 x+4x+3 x4 +5x +4 dx dx e) / 1 x3 - 1 dx
4. Evalute the following: (a) The region bounded by y = (3-2)' y = 0, x = 1, and x = 2 is revolved about the x-axis. (b) The region bounded by y = 1-x2, x = 0, x = 1,is revolved about the line x = 1....

Why are accruals called spontaneous sources of funds, what are their costs, and why dont firms use

Question:

Step by Step Answer:

Accruals are continually recurring shortterm liabilities es...View the full answer

Fundamentals of Financial Management

Students also viewed these Finance questions