When Using the Bardahl Formula, an Increase in Accounts Payable

question 56

Multiple Choice

When using the Bardahl formula, an increase in accounts payable (while holding purchases and operating expenses 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:

Inventory Planning

The process of determining the optimal quantity and timing of inventory for the purpose of aligning it with sales and production capacity.

Supply Chain Management

Connecting and integrating all parties or members of the distribution system in order to satisfy customers.