Question

Short-term financing is most common for financing of ____________.

• A. Fictitious assets
• B. Current assets
• C. Fixed assets
• D. All of the above

Answer 1

The correct option is B Current assets

Every business needs to invest into in current assets. These assets are also known as working capital to facilitate smooth working of day-to-day activities. Short term financing is raised to cope up with these day-to-day activites to run a business and has to be repaid within a year's time.