Which of the Following Items Would Normally Be Excluded from the Computation

question 36

Multiple Choice

Which of the following items would normally be excluded from the computation of working capital?

• A) Advances from customers for goods that will be shipped three months after the balance sheet date
• B) The portion of long-term debt that matures six months after the balance sheet date and will be paid from the regular cash account
• C) Prepaid insurance
• D) Cash surrender value of life insurance

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Definitions:

Alternative Dispute Resolution (ADR)

Various methods outside the judicial process used to resolve conflicts and disputes, such as arbitration and mediation.

Arbitration

A form of alternative dispute resolution where a neutral third party, known as an arbitrator, makes a binding decision to resolve a dispute between two or more parties.

Alternative Dispute Resolution (ADR)

A range of processes, such as mediation and arbitration, to resolve conflicts outside of traditional court settings.

Mediation

A form of alternative dispute resolution where a neutral third party helps the disputing parties reach a mutually acceptable agreement.