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

question 48

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 is most likely to be true?

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

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Definitions:

Emotion

A complex psychological state involving an individual's state of mind, physiological changes, and an outward expression or behavior.

Homeostasis

The tendency of a biological system to maintain stability while adjusting to conditions that are optimal for survival.

Hypothalamus

An essential part of the brain's limbic system involved in many functions, including releasing hormones and regulating body temperature.

Thalamus

A small structure within the brain that serves as a relay station for information between the cerebral cortex and the rest of the nervous system.