Working capital is computed as:
A) Long-term assets - Long-term liabilities.
B) Current assets ¸ Current liabilities.
C) Current assets - Long-term assets.
D) Current assets - Current liabilities.
D
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A remittance advice generally would be recorded in which of the following pairs of data stores?
a. customer master data and accounts receivable master data b. sales event data and accounts receivable master data c. accounts receivable adjustments data and accounts receivable master data d. cash receipts data and accounts receivable master data
Under the accrual basis of accounting, the allowance method is generally required for financial reporting purposes
a. True b. False Indicate whether the statement is true or false
All of the following are important provisions of the Sarbanes-Oxley Act except:
a. The establishment of a new Public Company Accounting Oversight Board. b. The requirement to prepare both FASB and IASB financial statements. c. A requirement that the external auditors report directly to the company's audit committee. d. A clause to prohibit public accounting firms that audit a company from providing any other services that could impair their ability to act independently in the course of their audit.
Summer, Inc has been in business for 20 years. During that time the company has consistently used the LIFO inventory costing method. Because of inflation, prices for merchandise have increased consistently over the 20 years. The company has maintained the same inventory quantities over the 20-year period. Which one of the following statements is true?
a. Summer, Inc. will have paid more income taxes over the past 20 years than it would have if it had used the FIFO method. b. Summer, Inc.'s total net income for the past 20 years is greater than it would have reported using another inventory method. c. Summer will have to continue using the LIFO method indefinitely because of generally accepted accounting principles and federal income tax rules. d. The ending inventory figure reported on the balance sheet may be significantly lower than its current value.