Net Working Capital Is Defined As

question 179

Multiple Choice

Net working capital is defined as:

• A)current assets minus current liabilities.
• B)working capital minus short-term debt.
• C)current assets plus current liabilities.
• D)All of the above

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Definitions:

Process Costing

An accounting methodology used for homogeneous products, where costs are accumulated over a period and assigned to units of output through an averaging process.

Units Transferred

The amount of finished or semi-finished products moved from one stage of production to another, or to the final inventory.

FIFO Method

An inventory valuation method that assumes the first items purchased (First-In) are the first ones sold (First-Out), affecting the cost of goods sold and inventory valuation.

Cost Reconciliation

The process of verifying the cost of goods sold by comparing the beginning and ending inventories, plus purchases, with the total goods available for sale.