Financial Reporting and Analysis Q191
0. Which of the following is least likely correct?
- A
A relatively high DSO indicates an inefficient collection of receivables.
- B
A high total asset turnover ratio implies an efficient usage of assets.
- C
A payables turnover ratio that is low relative to industry could indicate that the company is not making full use of the available credit facilities.
- Option : C
- Explanation : Statements A and B are correct. Statement C is incorrect because a payables turnover ratio that is high relative to industry could indicate that the company is not making full use of the available credit facilities.
