Working Capital Is Defined As

question 32

Multiple Choice

Working capital is defined as:

• A)current liabilities less current assets.
• B)current assets less current liabilities.
• C)current assets plus current liabilities.
• D)total assets less total liabilities.

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Definitions:

Salvage Value

The estimated residual value of an asset at the end of its useful life, usually considered for depreciation calculations.

Depreciation Method

A systematic approach used to allocate the cost of a tangible asset over its useful life.

Sales Price

The amount of money charged for a product or service, or the sum that customers are willing to pay for it.

Straight-line Method

A depreciation technique that allocates an equal amount of depreciation expense each year over the useful life of an asset.