Question

Bowman's Boats has an interval measure of 53 . This means that the firm has sufficient liquid assets to : a. cover all of its accounts receivable that are due within the next 53 days.

b. pay all of its debts that are due within the next 53 days.
c. cover its operating costs for the next 53 days. d. pay all of its accounts payable for the next 53 days. e. meet the sales quantity demands of its customers for the next 53 days.

Answer 1

An interval measure of 53 for Bowman's Boats indicates that the company has enough liquid assets to cover its operating costs for the next 53 days. This measure is a key indicator of the firm's short-term financial health and its ability to continue operations without needing additional funding.

Step-by-step explanation:

When Bowman's Boats has an interval measure of 53, it signifies the company's capacity in terms of liquidity. The interval measure is a metric that indicates how many days a firm can continue its operations using its current liquid assets without the need for further financing. This measure is crucial as it assesses the short-term financial stability of a company. In this scenario, the interval measure of 53 means that Bowman's Boats has sufficient liquid assets to cover its operating costs for the next 53 days. This is fundamentally different from being able to pay debts, cover accounts receivable, pay accounts payable, or guarantee sales quantity, which are not the primary focuses of this specific financial measure.