Accounts Receivable and Inventory Are Some of the Most Liquid

question 50

Essay

Accounts receivable and inventory are some of the most liquid assets a firm owns and their market values are typically fairly close to book value.Even so,in the eyes of many lenders,these assets make for inadequate collateral on loans,particularly if the business looking to borrow the money is in a liquidity crisis.Why do you think this is the case?

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Definitions:

Integration

The process of combining or coordinating separate elements or parts into a unified whole.

Coordinate Labour

Organizing and aligning the efforts of a workforce to achieve common goals and objectives efficiently.

Divide Labour

The process of dividing work into distinct tasks, each performed by a different worker or group of workers, to increase efficiency and productivity.

Interpersonal Styles

The characteristic way that individuals interact with others in personal and professional contexts.