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TRG manufactures umbrellas which have seasonal demand. The company is considering reducing levels of working capital, but would like to understand how this could affect
TRG manufactures umbrellas which have seasonal demand. The company is considering reducing levels of working capital, but would like to understand how this could affect sales and costs. Which three of the following outcomes are consequences for TRG of a reduced investment in working capital? Solution A.Increases the need for external finance. B.Reduces the flexibility to respond to increased sales. C.Increases the risk of running out of inventory. D.Reduces costs of inventory holding and financing trade receivables. E.Increases the opportunity to offer better customer credit terms
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