Capital Is the Financial Term for the Amount of Cash

question 193

True/False

Capital is the financial term for the amount of cash that a firm has in a bank checking account or other readily available form.

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Definitions:

Accrual Accounting

An accounting method that records revenues and expenses when they are incurred, regardless of when cash transactions occur, providing a more accurate picture of a company's financial health.

Diversification

A risk management strategy that mixes a wide variety of investments within a portfolio or a company's product line to minimize risks.

Alternative Accounting Policies

Different methods that an organization can use for reporting similar transactions or economic events in financial statements, based on accepted accounting principles.

Discontinued Operations

Components of a business that have been sold or otherwise disposed of, or will be disposing of, which are reported separately in financial statements.