Which One of the Following Is Not a Key Condition

question 94

Multiple Choice

Which one of the following is not a key condition indicating doubt regarding an entity's ability to continue as a going-concern?

• A)Adverse key financial ratios.
• B)Employee strike that halts operations for several months.
• C)Company has not paid dividends to date.
• D)Default on bank debt.

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Definitions:

NPV

A financial metric that calculates the total value of a project or investment by discounting future cash flows back to their present value and subtracting initial investment cost.

Scenario Analysis

A business planning technique in which the implications of variations in planning assumptions are explored. Also known as “what-if-ing.”

Abandonment Option

A financial decision allowing companies to cease a project or investment to avoid further losses.

NPV

Net Present Value; a calculation used to assess the profitability of an investment, considering the present value of its cash flows.