The financial manager of Picture Perfect Graphics negotiated a ________ with her bank that allows Picture Perfect to borrow up to $75,000 without collateral. This arrangement eliminates the need to renegotiate the terms of the loan and complete new paperwork each time Picture Perfect borrows money. The preapproved short-term loan agreement is contingent upon the bank having the funds available.
A) line of credit
B) factor agreement
C) cash flow conversion
D) renewable income option

Question

Quizplus · Accepted Answer

A line of credit means that a bank will lend your business a given amount of unsecured short-term funds, provided that the bank has the funds readily available.

The Financial Manager of Picture Perfect Graphics Negotiated a ________