As the chief financial officer (CFO) for a medium-sized service company, Shelley is concerned about the possibility of temporary cash shortages. Given the irregular cash flows from seasonal sales, she wants to ensure that her company's bank will provide adequate funds to cover any potential cash flow problem. The best strategy to ease Shelley's concern would be to arrange a revolving credit agreement with the bank.

Question

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A revolving credit agreement allows a company to borrow up to a specified amount from a bank on an as-needed basis. This would provide Shelley's company with access to funds to cover any temporary cash shortages, easing her concern about potential cash flow problems.

As the Chief Financial Officer (CFO) for a Medium-Sized Service