Which of the Following Is NOT an Example of Negative

question 95

Multiple Choice

Which of the following is NOT an example of negative debt covenants?

• A) Specifying what activities the business can enter into
• B) Restrictions on amalgamation with other companies
• C) Supplying creditors with annual audited reports
• D) Limiting annual dividend payments to shareholders

---

Definitions:

Cost Flow Assumption

The method by which a company values and moves its costs (such as FIFO, LIFO) to determine the cost of goods sold and ending inventory valuation.

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs from total revenue; also known as net profit.

Inventory System

A method for keeping track of the quantity, location, and status of goods a company has in stock.

Revenue Recorded

The process of documenting income earned by a business during a specific period, usually upon the delivery of goods or services.