Asked by Joshua Reavis on May 10, 2024
Verified
Net working capital can be referred to as:
A) total assets minus current liabilities.
B) current assets minus total liabilities.
C) cash minus current liabilities.
D) current assets minus current liabilities.
Net Working Capital
The difference between a company's current assets and current liabilities, indicating its short-term liquidity and ability to finance its operations.
Current Assets
Current assets are a balance sheet item that represents the value of all assets that can reasonably be expected to be converted into cash within one year, including cash, marketable securities, accounts receivable, and inventory.
Total Assets
The sum of all assets owned by a business, including cash, investments, property, and equipment, representing the resources it has at its disposal.
- Distinguish and sort components found in the balance sheet, paying particular attention to current liabilities, assets, and equity positions.
- Understand the process and classification of current assets, along with any outliers.
Verified Answer
Learning Objectives
- Distinguish and sort components found in the balance sheet, paying particular attention to current liabilities, assets, and equity positions.
- Understand the process and classification of current assets, along with any outliers.
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