The Objective of Managing Current Assets and Liabilities Is to

question 152

Multiple Choice

The objective of managing current assets and liabilities is to

• A)achieve as low a level of current assets as possible.
• B)achieve as low a level of current liabilities as possible.
• C)achieve a balance between profitability and risk that contributes to the firm's value.
• D)achieve as high a level of current liabilities as possible.
• E)none of the above

---

Definitions:

Statutory Lien

A legal claim on property, either personal or real, granted by law to creditors as security for a debt or obligation.

Debtor

An individual or entity that owes money or is in debt to another party.

Composition Agreement

An arrangement between a debtor and their creditors in which the creditors agree to accept a partial payment in satisfaction of the debts owed.

Creditors

Creditors are individuals or entities that are owed money by another entity or individual, known as a debtor.