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Operational cycle
Understanding the Link Between Current Liabilities and Operational Cycles
December 23, 2023
What is the relationship between current liabilities and a company's operational cycle?
Current liabilities and the operational cycle are intertwined. Short-term debts fluctuate with operational needs, such as inventory purchases or payables management. Aligning liabilities with the operational cycle ensures smoother cash flow and efficient working capital management, impacting the company's financial health and stability.
Tags : Operational Cycle , Working Capital , Short-Term Debts