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Attempts 0 Average 0/2 4. Current asset financing policies Pirms mariage a variety of current assets. Permanent current assets are necessary for firms to maintain their businesses, and they will be carried even through downturna in business cycles. Temporary current assets fluctuate seasonally or with business cycles, Firms must devise a financing strategy that best fits their business situation and that best manages their risk Use the following table to identify the different current asset financing policies Financing Policy Description This current asset financing policy tends to be the safest current asset financing policy however, it also tends to be less profitable than the other policies Long-term capita finances all permanent assets, but short-term debt finances temporary current assets Long-term capital finances some portion of the nonseasonal part of current assets, as well as all fixed assets, and short term loans finance all seasonal needs of current assets and the remaining portion of nonsensonal current assets. Suppose a tiem occasionally faces demand for short-term credit but usually has an excess of short-term capital to finance current assets. Which approach is the firm following? Maturity matching approach Aggressive approach Conservative approach

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