Question

In: Finance

What is the primary difference between a general operating line of credit and a permanent working capital line of credit?


What is the primary difference between a general operating line of credit and a permanent working capital line of credit?



General operating lines of credit frequently have a substantial principal balance



Permanent working capital lines of credit frequently have a substantial principal balance outstanding



Permanent working capital lines of credit generally are closed-end or non-revolving



General operating lines of credit usually fund rapidly growing businesses

Solutions

Expert Solution

Option C. Permanent working capital lines of credit generally are closed-end or non-revolving.

General operating line of credit is a type of revolving account. This arrangement allows borrowers to spend the money, repay it and spend it again in a virtually never-ending, revolving cycle.

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

What is the definition of net working capital? Net working capital is the difference between a...
What is the definition of net working capital? Net working capital is the difference between a firm's current assets and current liabilities.            Net working capital is the sum of a firm's cash and marketable securities accounts. Net working capital is the value of a firm's assets that can be converted into cash in one year or less.         Net working capital is the amount of cash a firm has on hand as of a specific date.
What is the difference between Permanent Funds and Private Purpose Trust Funds? The General Fund is...
What is the difference between Permanent Funds and Private Purpose Trust Funds? The General Fund is always considered to be a major fund. When are other governmental funds considered major? What is a bond refunding and why do governments refund bonds? What is the difference between a current refunding and advance refunding? cite source
what is the difference between a temporary and a permanent difference, with regards to income tax...
what is the difference between a temporary and a permanent difference, with regards to income tax reporting? Please provide an example of each of these in your response. Thank you
Explain the Capital Market Line, the Security Market Line and the difference between the two.
Explain the Capital Market Line, the Security Market Line and the difference between the two.
What are emotions? What is the difference between primary and secondary emotions? What are the primary...
What are emotions? What is the difference between primary and secondary emotions? What are the primary and secondary emotions? What is the developmental timecourse of primary and secondary emotions?
What is the difference between efficient frontier and capital allocation line? Please explain it from the...
What is the difference between efficient frontier and capital allocation line? Please explain it from the perspective of their compositions? (4pts)
What is the primary difference between commissions and referrals?
What is the primary difference between commissions and referrals?
What is the difference between primary and secondary apnea?
What is the difference between primary and secondary apnea?
state the difference between a temporary and permanent ostomy?
state the difference between a temporary and permanent ostomy?
From the standpoint of chemistry what is the main difference between a permanent wave and a...
From the standpoint of chemistry what is the main difference between a permanent wave and a depilatory?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT