Using the Following Balance Sheet and Income Statement Data, What

question 82

Multiple Choice

Using the following balance sheet and income statement data, what is the total amount of working capital? Average common shares outstanding was 10,000.

• A) $7,000
• B) $5,000
• C) $3,000
• D) $2,000

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Definitions:

Financial Break-Even

The point at which total revenues equal total costs and expenses, leaving no net gain or loss.

Accounting Basis

Refers to the method under which income and expenses are recognized and reported. The two primary methods are cash basis and accrual basis accounting.

NPV

Net Present Value, a calculation that discounts all cash flows associated with a project or investment back to the present value to assess its profitability.

Operating Cash Flow

A measure of the cash generated by a company's normal business operations, reflecting its capacity to sustain and grow operations.