When an Employer Has a Contract with an Employee for the Employee

question 7

Multiple Choice

When an employer has a contract with an employee for the employee to work for a set period of time,which of the following would not justify discharging the employee?

• A) financial hardship of the employer
• B) nonperformance of duties by the employee
• C) theft by the employee
• D) possession of drugs by the employee

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Definitions:

Total Equity

The value of the owners' interest in a company, calculated as the company's total assets minus its total liabilities.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from total revenue, often referred to as the bottom line.

Current Ratio

A liquidity ratio that measures a company’s ability to pay short-term obligations with its current assets.

Liquid

Describes assets that can be easily and quickly converted into cash without significant loss in value.