Operating leverage

Financial leverage

Return maximization

Working capital management

Increases and the current ratio decreases

Increases and the current ratio increases

Remains unchanged and the current ratio remains unchanged

Increases and the current ratio remains unchanged

Accounts receivable

Contribution margin

Cash

Cost of good sold

Reducing the A/R cycle increases cash collected and on hand.

Purchase of a new plant financed by a 20 year mortgage

Refinancing a short term note payable with a two year note payable

Cash collection of A/R

Payment of a 20 year mortgage payable with cash

Fluctuating current assets with long term debt

Permanent current assets with long term debt

Permanent current assets with short term debt

Fluctuating current assets with short term debt

Ideal

Ideal as long as the company does not lose too many sales

Not ideal

Irrelevant