Wilbur Is Attempting to Raise Some Quick Cash for His

question 13

Multiple Choice

Wilbur is attempting to raise some quick cash for his business by selling its accounts receivable to a finance company, this is called

• A) selling short.
• B) factoring.
• C) mortgaging the future.
• D) pledging receivables.

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Definitions:

Working Capital Ratio

A financial metric that measures a company's ability to pay off its short-term liabilities with its short-term assets, indicating liquidity.

Current Liabilities

Short-term financial obligations due within one year or within a company's operating cycle, whichever is longer.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from revenues.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue.