Ralph Owns a Lumber Yard and Has a $500,000 Purchase

Multiple Choice

Ralph owns a lumber yard and has a $500,000 purchase order from a construction company. His cost of goods sold for this order is $300,000. Because his company needs working capital, the most logical loan for the lumber yard would be to use

A) an equipment-based loan.
B) factoring.
C) purchase-order financing.
D) asset-based financing.