The "Runway" Refers To

question 44

Multiple Choice

The "Runway" refers to:

• A) How often the company turns over inventory.
• B) How long the company has been in business.
• C) How many months it would take for the company to run out of money.
• D) The time in which it takes to calculate the COH.

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Definitions:

Potential Benefit

The future gain or return that may be obtained as a result of an investment or action.

Earnings Quality

Pertains to the degree to which reported income provides a true representation of the company's financial performance.

Source of Cash Flow

Source of Cash Flow refers to the origins of the money coming into a business, indicating how the company is earning its income.

Net Operating Loss

A financial situation where a company's allowable tax deductions are greater than its taxable income, leading to a negative taxable income.