Working Capital Policy Involves a Tradeoff Between Easier Operation and ____

question 237

Multiple Choice

Working capital policy involves a tradeoff between easier operation and ____.

• A)more working capital
• B)spontaneous liabilities
• C)temporary financing
• D)the cost of carrying short-term assets

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Definitions:

Incremental Sales

Additional sales generated by a new action or decision, beyond what would have been sold without it.

Cash Operating Expenses

Expenses that a company pays out in cash during the operating cycle, excluding non-cash expenses like depreciation.

One-Time Expense

An uncommon or non-recurring charge that companies incur, which does not reflect regular operating activities.

Straight-Line Depreciation

A technique for determining an asset's depreciation by uniformly distributing its cost throughout its lifespan.