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CIPS L4M4 Exam - Topic 3 Question 30 Discussion

Which of the following should be considered when calculating ratios relating to a supplier's liquidity?
C) receivables
A) inventory
B) reserves
D) profit

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?

Show Suggested Answer Hide 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

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Cory
9 months ago
All of these can impact liquidity ratios.
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Domingo
9 months ago
Totally agree, reserves matter for liquidity!
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Huey
10 months ago
Wait, profit? Isn't that more about profitability than liquidity?
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Malika
10 months ago
I think inventory is important too.
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Alaine
10 months ago
Definitely need to consider receivables!
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Ciara
10 months ago
Profit seems less relevant for liquidity calculations, but I might be overthinking it.
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Antonio
11 months ago
I practiced a similar question where receivables were emphasized, so I feel confident that they should be included here.
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Eliz
11 months ago
I'm a bit unsure about reserves; I don't recall if they directly impact liquidity ratios like receivables do.
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Carri
11 months ago
I remember we discussed liquidity ratios in class, and I think inventory is definitely a key factor.
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Chanel
11 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.
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Carli
11 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.
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Earleen
11 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.
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Tamar
11 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.
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Rasheeda
1 year ago
Hmm, should I go with the 'liquid' option? Get it? Liquid? Liquidity? Ah, I crack myself up.
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Amber
1 year ago
This is easy - it's C. Receivables are key for assessing a supplier's ability to pay their short-term obligations.
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Corinne
1 year ago
Oh, I see. Thanks for clarifying!
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Tom
1 year ago
No, it's actually C) receivables
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Ashlyn
1 year ago
I think it's A) inventory
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Willard
1 year ago
C) receivables
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Ricki
1 year ago
Profit? Really? I thought we were looking at liquidity, not profitability. Hmm, let me think this through.
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Martina
1 year ago
B) reserves
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Dana
1 year ago
C) receivables
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Hailey
1 year ago
A) inventory
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Margot
1 year ago
Inventory, reserves, and receivables - got it! Can't forget the cash flow situation.
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Novella
1 year ago
B) reserves
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Verlene
1 year ago
Don't forget about cash flow!
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Alise
1 year ago
C) receivables
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Felicitas
1 year ago
A) inventory
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Vincent
1 year ago
Receivables? Of course! How else will I know if the supplier can pay their bills on time?
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Louis
1 year ago
D) profit
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Karol
1 year ago
C) receivables
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Elmer
1 year ago
A) inventory
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Maira
1 year ago
I believe inventory should also be considered for supplier's liquidity ratios.
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Virgina
1 year ago
I agree with Adelle, receivables are important to assess liquidity.
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Adelle
1 year ago
I think we should consider receivables for supplier's liquidity ratios.
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