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Short-Term Financing and Working Capital

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Explain the relationship between short-term financing and working capital practices.

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The solution explains short-term financing and working capital practices.

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This is the issue regarding working capita management. Working capital is the firm's total current assets used in operations. Working capital = total current assets. These current assets include cash, marketable securities, prepaid expenses, accounts receivable, inventory, and other current assets. Working capital represents the liquid portion of the firm. Net Working Capital means the difference between current assets and current liabilities, and therefore, represents that ...

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