Question
Company XYZ has purchased a new machinery to expand its
production capacity. This purchase of Fixed Asset will _________Solution
Working capital is the difference between the capital assets and capital liabilities. The purchase of fixed assets can be done by 2 ways: • Cash payment – this would reduce cash and therefore the current assets, thereby reducing the working capital • Credit purchase – this would increase the creditors and therefore the current liabilities, thereby again reducing the working capital.
Oral admissions as to the contents of a document are
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