Question

The aspect of financial decision making with reference to current assets or short-term assets is known as _______________.

• A. Capital budgeting
• B. Working capital management
• C. Dividend policy
• D. Investment analysis

Answer 1

The correct option is B Working capital management

Decisions relating to working capital and short-term financing are referred to as working capital management.

The policies aim at managing the current assets (generally cash and cash equivalents, inventories and debtors ) and the short-term financing, such that cash flows and returns are acceptable.