CIPS L4M4 Exam - Topic 3 Question 30 Discussion

Actual exam question for CIPS's L4M4 exam

Question #: 30
Topic #: 3

[All L4M4 Questions]

Which of the following should be considered when calculating ratios relating to a supplier's liquidity?

Ainventory

Breserves

Creceivables

Dprofit

Show Suggested Answer

Suggested Answer: C

The correct answer is 'yes- the public sector should advertise as a call for competition'. They do this in the Official Journal of the European Union (OJEU). Public Sector has to be transparent about everything and treat all suppliers equally. So they can't just approach the ones they like.

In the study guide it says OIEU and this is a typo. It's OJEU.

What is The OJEU in 2 minutes or less (trackerintelligence.com)

by Jennie at Feb 08, 2025, 08:06 AM

Limited Time Offer

25%

Off

Get Premium L4M4 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Cory

7 months ago

All of these can impact liquidity ratios.

upvoted 0 times

...

Domingo

8 months ago

Totally agree, reserves matter for liquidity!

upvoted 0 times

...

Huey

8 months ago

Wait, profit? Isn't that more about profitability than liquidity?

upvoted 0 times

...

Malika

8 months ago

I think inventory is important too.

upvoted 0 times

...

Alaine

8 months ago

Definitely need to consider receivables!

upvoted 0 times

...

Ciara

9 months ago

Profit seems less relevant for liquidity calculations, but I might be overthinking it.

upvoted 0 times

...

Antonio

9 months ago

I practiced a similar question where receivables were emphasized, so I feel confident that they should be included here.

upvoted 0 times

...

Eliz

9 months ago

I'm a bit unsure about reserves; I don't recall if they directly impact liquidity ratios like receivables do.

upvoted 0 times

...

Carri

9 months ago

I remember we discussed liquidity ratios in class, and I think inventory is definitely a key factor.

upvoted 0 times

...

Chanel

9 months ago

Profit? Really? I don't think that has much to do with liquidity. I'm going to go with inventory, receivables, and reserves as the important factors to consider.

upvoted 0 times

...

Carli

9 months ago

Okay, I've got this. Liquidity is all about how quickly a company can convert assets into cash to pay its bills. Inventory, receivables, and reserves are the key things to look at here.

upvoted 0 times

...

Earleen

9 months ago

Hmm, not sure about this one. Liquidity ratios can get tricky. I'll need to think carefully about which elements of the balance sheet are most relevant for assessing a supplier's short-term financial health.

upvoted 0 times

...

Tamar

9 months ago

This seems like a straightforward liquidity question. I'll focus on the key factors that affect a supplier's ability to meet short-term obligations, like inventory, receivables, and reserves.

upvoted 0 times

...