Which of the following current asset financing policies reflects the firm financing the seasonally-adjusted average level of asset demand with long-term debt and equity enabling it to use both short-term financing and short-term investing as needed?
A) Flexible financing policy
B) Restrictive financing policy
C) Compromise financing policy
D) Alternative financing policy

Question

Quizplus · Accepted Answer

A compromise financing policy involves using long-term financing for the average level of current assets and short-term financing for seasonal variations, allowing the firm to adjust its financing strategy based on current needs.

Which of the Following Current Asset Financing Policies Reflects the Firm