Seasonal buildups of inventory and receivables are generally financed with
A) short-term loans.
B) long-term loans.
C) stockholders' equity.
D) accruals.

Question

Quizplus · Accepted Answer

Seasonal buildups of inventory and receivables are typically short-term in nature, and therefore, are best financed with short-term loans rather than long-term loans or stockholders' equity. Accruals may be used to finance seasonal buildups, but they are not as common as short-term loans.

Seasonal Buildups of Inventory and Receivables Are Generally Financed with