Reference no: EM131896562

1. Which of the following expenses are typically classified as not recoverable in leases?

Electricity

Leasing commissions

Financing fees

Capital outlays

2. Which of the following statements is CORRECT?

If a bank loan officer saw that a firm’s days in patient accounts receivable (ACP) was higher than the industry average and was also increasing and trending still higher, this would be interpreted as a sign of strength.

If a firm increases its patient service revenues while holding its accounts receivable constant, then, other things held constant, its days in patient accounts receivable (ACP) will increase.

There is no relationship between the days in patient accounts receivable (ACP) and the days cash on hand. These ratios are totally independent of each other.

A reduction in accounts receivable (due to collection) would have an adverse effect on the current ratio, but it would lead to a decrease in the cash ratio.

If a firm increases its patient service revenues while holding its accounts receivable constant, then, other things held constant, its days in patient accounts receivable (ACP) will decline.