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Chapter 16 Homework Assignment

Chapter 16 Homework Assignment

Q Hello Everyone: Please answer each of the questions in at least two complete sentences. 1.-10. Go to page 528 in the textbook and answer the ten Check Your Progress questions. 11. Do you think that a US Treasury Bill is a safe place to invest your money? Explain. 12. What three stocks would you like to buy and why? 13. Do you feel comfortable investing in stocks when you know they will fluctuate in value over time?

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1. When there is management of an organization’s liabilities as well as an organization’s assets belong to the short-term, it is known as working capital management. When there is such type of management, the capital becomes a strength for the organization. 2. There can be company accounts in which any kind of money earned by the company from a customer gets deposited via lockboxes. These lockboxes are opened by commercial banks in which the company might have accounts. This is because of these lockboxes being owned by the commercial banks and also made available at the commercial banks. In this way, the movement of cash flow to an organization can be made faster by an organization. There must be speeding up of cash flow by an organization to ensure that money earned by the organization can keep multiplying or at least being more than the amount earned by the organization. There can be interest earned from commercial banks by an organization. 3. There can be Commercial Paper in which a particular amount of money has to be paid legally by promising in writing by an organization to another. There can be Commercial Certificates of Deposit whose trading can be done before the maturity of the certificates. $100,000 is the starting amount of certificates which can be availed at a minimum. Brokerage companies can issue such certificates. There can also be commercial banks which can issue such certificates. There can also be Treasury Bill which can be utilized for the purpose of raising money by the American government. Every such bill is a debt-obligation for the American government to utilize and is applicable in the short-term. 4. It implies that there can be requesting by an organization to legally borrow some already expressed amount of money from a bank. The bank will also listen to the organization. However, there must be presence of the requested amount of money in the bank for providing the money to the organization as a loan. 5. When assets can be categorized as assets for the long-term to remain for the organization and/or individual for several years in future, they are known as fixed assets.