David has a company decorating houses for the holidays.He has secured a $25,000 line of credit from his bank.For which purpose is David more likely to use this credit line?
A)a warehouse to store decorations until they are sold
B)labor to install the decorations in November
C)a truck with a ladder to put up lights
D)a full-time,year-round office person to answer phones and take orders

Question

Quizplus · Accepted Answer

David is likely to use the credit line to pay for labor to install the decorations in November, as this is a seasonal business and he may not have enough cash on hand to cover the cost of hiring workers. The other options (renting a warehouse, buying a truck with a ladder, hiring a full-time office person) are not directly related to the seasonal decorating business and may not be necessary or cost-effective for the company at this time.

David Has a Company Decorating Houses for the Holidays