--%>

Describe matching principle of working capital financing

Describe matching principle of working capital financing? Explain the benefits of following this principle?
The matching principle is while short-term financing is utilized for temporary current assets while long-term financing is utilized for permanent current assets & fixed assets. The basic benefit of this approach is that as temporary current assets are sold off the proceeds can be utilized to pay off the short-term debt.

   Related Questions in Finance Basics

  • Q : Frequency Distribution What is

    What is Frequency Distribution? Compare Categorical Frequency Distribution, Ungrouped Frequency Distribution, Grouped Frequency Distribution?

  • Q : Explain Conference Committee Conference

    Conference Committee: It is a committee of three members (that is two from the majority party and one from the minority party) from each house, appointed to gather and resolve differences among versions of a bill (example, when one house of the Legisl

  • Q : Short run and long run influence Normal

    Normal 0 false false

  • Q : Define the term Surplus Define the term

    Define the term Surplus: It is an outdated term for a fund’s excess of assets (or resources) over liabilities.

  • Q : What is Make-Buy Analysis Make-Buy

    Make-Buy Analysis: Business decision which compares the costs and advantages of manufacturing a product or product component alongside purchasing it. When the purchase price is high than what it would cost the manufacturer to prepare it, or when the m

  • Q : Describe price–quantity effects Normal

    Normal 0 false false

  • Q : Define Limited-Term Position

    Limited-Term Position (LT): Any place that has been authorized only for a particular length of time with a set termination date.Limited-term positions might be authorized throughout the budget procedure or in transactions approved by the D

  • Q : Public finance can you do this

    can you do this homework? My state Taxes

  • Q : What is an Agency Agency: It is a legal

    Agency: It is a legal or official reference to a government association at any level in the state organizational hierarchy. Or Government organizations belong to the highest sta

  • Q : What are Governmental Cost Funds

    Governmental Cost Funds: For lawful basis accounting and budgeting aims, funds which derive revenue from the taxes, licenses, and fees.