Wednesday, February 20, 2013

A negative feature of defining investment by excluding the portion of total assets employed that are financed by short-term creditors is

ACCOUNTING

Multiple Choice

A negative feature of defining investment by excluding the portion of total assets employed that are financed by short-term creditors is

a. current liabilities are sometimes difficult to define.

b. short-term debt is always more expensive to finance than long-term debt.

c. this method encourages managers to use an excessive amount of short-term debt.

d. this method encourages managers to use an excessive amount of long-term debt.

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