A Small Company Has Current Assets of $112,000 and Current

question 45

Multiple Choice

A small company has current assets of $112,000 and current liabilities of $117,000. Which of the following statements about that company are most likely to be true?

• A) Since net working capital is high, the company will likely have little difficulty meeting its obligations.
• B) Since net working capital is nearly zero, the company is well run and will have little difficulty attracting investors.
• C) Since net working capital is negative, the company will not have enough funds to meet its obligations.
• D) Since net working capital is very high, the company will have ample money to invest after it meets its obligations.

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Definitions:

Perception

The process of recognizing, interpreting, and making sense of sensory information.

Anxiety

An emotion characterized by feelings of tension, worried thoughts, and physical changes like increased blood pressure.

Bulimia Nervosa

A disorder related to eating, marked by periods of excessive food consumption followed by unsuitable weight management techniques, like self-induced vomiting or intense physical activity.

Binge/Purge Cycle

A behavior pattern seen in bulimia nervosa, involving excessive eating followed by efforts to avoid weight gain.