Question

Fill in the blanks: Sales managers would generally prefer a ____________ current asset investment strategy. Financial managers would generally prefer a ____________ current asset investment strategy.

a) relaxed, restrictive (respectively

b) relaxed, relaxed

c) restrictive, restrictive

Answer 1

In restricted policy, the estimation of current assets for achieving targeted revenue is done very aggressively without considering for any contingencies and provisions for any unforeseen event.

Relaxed policy is just the opposite of restricted policy. In this policy, the estimation of current assets for achieving the targeted revenue is prepared after careful consideration of uncertain events such as seasonal fluctuations, a sudden change in the level of activities or sales etc.

The answer is thus-

B) relaxed, relaxed