Some discount stores are able to sell items before they have to pay their suppliers, resulting in a negative:
A) net profit.
B) return on assets.
C) number of inventory turns.
D) cash-to-cash measure.

Question

Quizplus · Accepted Answer

The situation described in the question is known as a negative cash-to-cash measure, where the store is able to sell items and collect cash from customers before they have to pay their suppliers. This can be beneficial for cash flow, but ultimately results in a negative cash-to-cash measure as the store is not holding onto inventory long enough to pay off their suppliers. This can lead to strain on the relationships with suppliers and potentially damage the store's reputation in the industry.

Some Discount Stores Are Able to Sell Items Before They