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Managers Must Understand How Transactions Affect Working Capital

Question 72

Multiple Choice

Managers must understand how transactions affect working capital


A) because GAAP does not allow companies with weak working capital to obtain loans.
B) because lenders often use this to assess a company's ability to meet current obligations.
C) so that management can avoid transactions that increase working capital.
D) in anticipation of meeting creditors guidelines before issuing new stock.

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