Which of the Following Is Not a Potential Indicator of Going-Concern

question 7

Multiple Choice

Which of the following is not a potential indicator of going-concern problems for a client?

• A)Negative trends in key financial ratios.
• B)Loss of key personnel.
• C)Plan to sell nonessential assets.
• D)Default on a loan.

---

Definitions:

Average Total Cost Curve

A graphical representation showing the cost per unit of output when fixed and variable costs are summed up and divided by the total output.

Variable Costs

Costs that vary directly with the level of production or output, such as raw materials and labor expenses.

Fixed Costs

Business expenses that are not affected by changes in the level of production or sales, such as rent and salaries.

Total Variable Costs

The sum of expenses that change directly with the level of output or production volume.