All of the Following Will Result in an Increase in Net

question 72

Multiple Choice

All of the following will result in an increase in net working capital except _________.

• A) An increase in inventory
• B) A decrease in accounts payable
• C) An increase in cash
• D) An increase in accruals

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Definitions:

Income Statement

A financial report that shows the revenue, expenses, and profit or loss of a business over a specific period of time.

Adjusting Journal Entry

An accounting entry made to correct or update the financial records and ensure accurate reporting.

Liabilities

Financial obligations or debts that a company owes to external parties, which must be settled over time through the transfer of economic benefits.

Deferral

Accounting method to postpone the recognition of revenues or expenses until a future accounting period.