Directions: Choose the correct answer from the choices. Write your answers on a separate sheet of paper. It is designed to ensure that a company operates efficiently by monitoring and using its current assets and liabilities to the best effect. A. working capital management C. inventory management B. cash management D. receivable management These refer to cash, accounts receivable, inventories, and prepaid expenses. A. current assets C. current liabilities B. noncurrent assets D. owner’s equity It is the difference between current assets and current liabilities. A. permanent working capital C. temporary working capital B. net working capital D. contractual working capital In this working capital financing policy, the permanent working capital requirements should be financed by long-term sources while temporary working capital requirements should be financed by short-term sources of financing. A. maturity-matching C. aggressive B. conservative D. modern It is the time to collect cash from the sale of the inventory. 6 In this working capital financing policy, some of the permanent working capital requirements are financed by short-term sources of financing. A. maturity-matching C. aggressive B. conservative D. modern 7 In this kind of working capital policy, some of the temporary working capital requirements are financed by long-term sources of financing. A. maturity-matching C. aggressive B. conservative D. modern 8 It is the borrower’s willingness to pay the loan. A. character C. collateral B. capacity D. condition 9 It is the borrower’s security pledge for the loan payment. A. character C. collateral B. capacity D. condition 10 It is the borrower’s ability to pay the loan. A. character C. collateral B. capacity




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