A Fatal Flaw Is a Circumstance or Development That, in and of Itself

question 9

True/False

A fatal flaw is a circumstance or development that, in and of itself, could render a new business unsuccessful.

---

Definitions:

Loss

The negative financial result from a business’s operations or transactions when costs and expenses exceed revenues.

Net Income

The amount of money left after all expenses, taxes, and costs have been subtracted from total revenue, indicating the profit earned by a company.

Indirect Method

A cash flow statement preparation method that adjusts net income for the changes in balance sheet accounts to calculate the cash from operating activities.

Depreciation

The methodical distribution of a physical asset's cost across its lifetime, reflecting the asset's depreciation, wear, and eventual obsolescence.