Affirmative Covenants Generally Would Not Include Which of the Following

question 25

Multiple Choice

Affirmative covenants generally would not include which of the following stipulations?

• A)The lender has the right to inspect business assets and business contracts.
• B)Limits on the borrower's total indebtedness.
• C)The borrower must maintain insurance on business properties.
• D)Specific financial covenants and reporting requirements.

---

Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from revenue.

Tax Account

An account designated for the accumulation and payment of taxes owed by an individual or organization.

Net Working Capital

The gap between a firm's present assets and liabilities, showcasing its immediate fiscal stability and the effectiveness of its operations.

Incremental Cash Flow

The additional cash flow a company receives from undertaking a new project, emphasizing the difference in the company's cash flows with and without the project.