Outdoor Adventures Inc. is in a highly seasonal business, and the following summary balance sheet data show its assets and liabilities at peak and off-peak seasons (in thousands of dollars): Peak Off-Peak Cash $ 50 $ 30 Marketable securities 0 20 Accounts receivable 40 20 Inventories 100 50 Net fixed assets 500 500 Total assets $690 $620 Spontaneous liabilities $ 30 $ 10 Short-term bank debt 50 0 Long-term debt 300 300 Common equity 310 310 Total claims $690 $620 What can we conclude from this data?

a. Without income statement data, we cannot determine the aggressiveness or conservatism of the companys working capital financing policy. b.

Ski Lifts follows a relatively conservative approach to working capital financing; that is, some of its short-term needs are met by permanent capital. c.

Ski Liftss working capital financing policy is relatively aggressive; that is, the company finances some of its permanent assets with short-term discretionary debt.

d. Ski Liftss working capital financing policy calls for exactly matching asset and liability maturities.