Baldwin Corporation’s inventory expressed as a percentage of current assets increased from 25% last July to 35% this July. The factor that is least likely to cause this increase is that Baldwin

Answer (A) is correct. This statement is least likely to explain an increase in current assets from last July to this July. If Baldwin was a seasonal company with traditionally higher activity in the summer months, it would budget similar amounts for each summer in expectation of the high activity. The sudden increase in current assets for the following summer would not be explained by the fact that they are a seasonal company.