The Difference Between Total Assets of a Firm and Its

question 13

Multiple Choice

The difference between Total Assets of a firm and its Total Liabilities is called.

• A) Net working capital
• B) Net current assets
• C) Net worth
• D) None of the above

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of the business, whichever is longer.

Credit Policy

Guidelines that a company follows to determine credit terms for customers, aiming to balance sales and the risk of bad debts.

Derived-Demand Inventory

Inventory levels that are influenced by the demand for the final goods or services produced by a company.

Auto Manufacturer

A company engaged in the designing, production, marketing, and selling of motor vehicles.