Q465
Under a conservative financing policy, a firm would use long-term financing to finance some of the temporary current assets. What should the firm do when a 'dip' in temporary current assets causes total assets to fall below the total long-term financing?
A.
Use the excess funds to pay down long-term debt
B.
Invest the excess long-term financing in marketable securities
AnswerC.
Use the excess funds to repurchase common stock
D.
Purchase additional plant and equipment
Answer: Option B
Solution
Answer: Option B
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