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When projecting a companys financial performance over future periods, we use a debt schedule to determine how much debt remains outstanding and the amount of

When projecting a companys financial performance over future periods, we use a debt schedule to determine how much debt remains outstanding and the amount of interest expense the company will incur. Assume our model uses excess cash to pay off prepayable debt, and that cash available for optional repayment of debt is negative in period t. How would that impact our calculation of the outstanding balance of a revolver (revolving line of credit)?

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The revolver balance will be decrease because we should subtract the cash deficit from our debt balance

The revolver balance is unaffected by cash available for optional repayment of debt

The revolver balance will increase as the company borrows more cash to meet other cash requirements

None of these

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