Your firm issues 20-year bonds.This type of financing would be most appropriate for which of the following activities?
A)The support of accounts receivable
B)The construction of a new warehouse
C)The support of accounts payable
D)The financing of inventory

Question

Quizplus · Accepted Answer

The construction of a new warehouse is a long-term project, which makes the issuance of 20-year bonds an appropriate financing option. Accounts receivable, accounts payable, and inventory are short-term assets and liabilities that do not require long-term financing.

Your Firm Issues 20-Year Bonds