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A Services Firm Does All Its Business in Cash Only

question 80

Multiple Choice

A services firm does all its business in cash only. The firm projects a cash balance of $3,000 in its account after all taxes and costs are paid. The owners plan to invest $8,000 and pay a dividend of $1000. How much net new financing is needed?

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Definitions:

Unforeseeable Misuses

Situations or actions where a product is used in a way that could not have been predicted, possibly leading to harm or injury.

Obvious Dangers

Hazards or risks that are apparent and should be reasonably recognized by an individual, reducing or eliminating liability for injuries resulting from such dangers.

State-of-the-Art Defense

The state-of-the-art defense is a legal argument used in product liability cases to claim that the product was made in accordance with the highest level of technology and knowledge available at the time of manufacture.

Strict Liability

A legal doctrine that holds a party responsible for damages or harm caused by their actions, without the need to prove negligence or fault.