Which of the Following Statements Is Most Correct

question 54

Multiple Choice

Which of the following statements is most correct?

• A) Accruals are an expensive way to finance working capital.
• B) A conservative financing policy is one in which the firm finances all of its fixed assets with long-term capital and part of its permanent net operating working capital with short-term, nonspontaneous credit.
• C) If a company receives trade credit under terms 2/10, net 30, this implies the company has 10 days of free trade credit.
• D) A firm following an aggressive financing policy would finance all its permanent NOWC with long-term capital.

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Definitions:

First Quartile

The value below which 25% of the data falls.

Ages of Retirees

Statistical data referring to the range, mean, or distribution of ages at which individuals retire from their professional careers.

Uninsured Retirees

Individuals who are retired and lack health insurance coverage.

Relative Position

Refers to the placement or ranking of a value or an object in relation to others in a dataset, indicating its comparative magnitude or order.