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It Figures

How to determine how much of a line of credit you need for your growing business

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This story appears in the December 2000 issue of Entrepreneurs Start-Ups magazine.

Q: How do we figure the line-of-credit needs for our growing board games distributorship?

A: Figuring how to finance your trade cycle is not a trivial pursuit. As sales grow, so will inventory and accounts receivable. You finance this growth with increased accounts payable, after-tax profits, and a business line of credit.

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