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Jennifer has noted that Daud Mega, the managing director who started the business 20 years ago, injected RM500,000 cash as an interest free loan in
Jennifer has noted that Daud Mega, the managing director who started the business 20 years ago, injected RM500,000 cash as an interest free loan in order to improve the company's cash flow and reduce the risk to the company of breaching its loan covenant, which is based on interest cover.
Should you be concerned about the source of cash loaned by Daud Mega to the business? Explain.
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