Multiple choice

1) Companies that are mostly influenced by seasonal sales have to make a choice between 

A) level production and inventory buildup.

B) seasonal production and an uneven workforce.

C) a stable workforce and a fluctuating workforce.

D) All of the above 

 2) The Jersey Corporation has 70% of its capital structure in the form of equity capital.  $150,000 in capital needs to be raised for a project but only $30,000 in funds is available through retained earnings.  How much must be raised through common stock to maintain Jersey Corporation's capital structure? 

A) $105,000 

B) $75,000 

C) $120,000 

D) $21,000 

3) If sales volume exceeds the break-even point, the firm will experience 

A) an operating loss. 

B) an operating profit. 

C) an increase in plant and equipment. 

D) an increase in stock price. 

4) Firms that successfully increase their rates of inventory turnover will, among other things, 

A) be able to reduce their borrowing needs. 

B) be able to reduce their dividend payments to stockholders. 

C) find it more difficult to be given credit by their resource suppliers. 

D) have a greater need for high balances in their cash accounts.