Which of the following is most likely to occur if a firm under-invests in net working capital?
A) The firm might not have sufficient cash to pay its bill in a timely manner.
B) The firm might not have adequate inventory to meet the needs of its customers.
C) The firm could be losing sales because its terms of sale are too strict.
D) All of the above.

Question

Quizplus · Accepted Answer

If a firm under-invests in net working capital, it may not have sufficient cash to pay its bills, it may not have enough inventory to meet customer needs, and it may be losing sales due to overly strict sales terms. Therefore, all of the above options are likely consequences of under-investing in net working capital.

Which of the Following Is Most Likely to Occur If