The accounts receivable and inventory are examples of ___________?
Correct answer: A. short term working capital
- A. short term working capital
- B. long term working capital
- C. long term fixed assets
- D. short term fixed assets
Explanation
Accounts receivable and inventory are current assets that normally turn over within the operating cycle, so they form part of short-term working capital. They are not fixed assets.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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