When Using the Bardahl Formula, an Increase in Annual Credit

question 44

Multiple Choice

When using the Bardahl formula, an increase in annual credit sales (while holding the average accounts receivable balance constant) has which of the following effects on the working capital requirements?

• A)increase
• B)decrease
• C)no effect
• D)increase, decrease, or no effect, depending on other factors

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Definitions:

Being Entrepreneurial

The act or mindset of identifying and starting new business ventures, especially in areas of high risk or innovation.

Client Information

Data related to customers or clients, including personal and transactional information, used by businesses to provide services.

Group Working

The act of multiple individuals coming together to work on a common task or project.

Immediate Family Members

Those individuals closely related by blood or marriage, typically including parents, siblings, spouses, and children.