TRUE or FALSE: For distressed firms with both bank and public debt outstanding, banks never make concessions unless public debtholders also restructure their claims. a. TRUE b. FALSE ANSWER A
Date: September 19th, 2020
The ________ uses no, or very little, safety stock. A) basic economic order quantity system B) materials requirement planning system C) just-in-time system D) FIFO method ANSWER C
Date: September 19th, 2020
In the EOQ model, ________ costs are the variable costs per unit of holding an item of inventory for a specified time period. A) marginal B) order C) carrying D) processing ANSWER C
Date: September 19th, 2020
TRUE or FALSE: According to empirical studies, the combination of secured private debt and numerous public debt issues (in a distressed firm’s capital structure) impedes out-of-court debt restructuring and increases the probability of a Chapter 11 filing. a. TRUE b. FALSE ANSWER A
Date: September 19th, 2020
To preserve the value of a distressed firm, it is generally important for the firm to continue operating throughout Chapter 11 proceedings. Generally, the firm’s current management is allowed to run the firm during the proceedings under a restrictive arrangement called a. the value-preservation dictum. b. debtor-in-possession. c. managerial discretion. d. trustee assignment. […]
Date: September 19th, 2020
Empirical evidence indicates that for distressed firms, higher pre-distress leverage increases the probability of operational actions (e.g., asset restructuring and employee layoffs) and financial actions (e.g., dividend cuts). This evidence is consistent with the: a. disciplinary role of debt. b. wasteful cuts hypothesis. c. managerial discretion hypothesis. d. leverage aggressiveness hypothesis. ANSWER A
Date: September 19th, 2020
In the ABC system of inventory management, the ________ method or system is appropriate for managing B items. A) basic economic order quantity B) materials requirement planning C) two-bin D) just-in-time ANSWER A
Date: September 19th, 2020
The objective for managing inventory is to ________. A) turn over inventory as quickly as possible without losing sales from stockouts B) improve the average collection period without affecting the sales C) make payment for the inventory as slowly as possible without losing suppliers D) reduce the time taken to process inventory into finished goods […]
Date: September 19th, 2020
The ________ is an inventory technique that takes into account various operating and financial costs to determine the order quantity for a specific inventory item. A) JIT system B) ABC system C) EOQ model D) LIFO model ANSWER C
Date: September 19th, 2020
In a(n) _, the parent of a multiple-subsidiary firm issues, via an IPO, equity shares for a particular subsidiary, though the parent usually keeps majority ownership of the shares, and thus control of the subsidiary. a. asset sale b. spin-off c. equity carve-out d. targeted stock issuance ANSWER C
Date: September 19th, 2020
