Answered: Current assets - current liabilities =…

Business

Accounting

Current assets - current liabilities = [A] fixed capital [B] working capital [C] opening capital [D] closing capital

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter24: Analysis Of Financial Statements

Section: Chapter Questions

Problem 2MC

See similar textbooks

Related questions

Q: Return on Capiatal employed = O a. Return on Total Assets O b. Return on Equity Oc. Return on…

A: Solution: Return on capital employed = EBIT/ Capital employed Capital employed = Total assets -…

Q: The term capital structure refers to_______ O a. Long-term debt, preferred stock, and common…

A: Capital structure is an important term used in financial management of the company. The answer is…

Q: Which ratio indicates the proportion of assets financed out of shareholders’ funds? (A) Debt equity…

A: Introduction: Any person, organization, or institution that owns stock in a company is a…

Q: Working Capital is a measure used to assess the liquidity of the company, computed as current assets…

A: The Answer is false Refer step2 for explanation

Q: how to arrive at earnings before paying the interest cost under the current capital structure

A: From Company data you go income statement of company

Q: . Capital structure is the: a. mix of current and long-term assets, such as cash and fixed assets…

A: Capital structure means how firm has financed through long term sources to meet capital expenditure…

Q: Working capital is an indication of the firm’s ________.A. asset utilizationB. amount of noncurrent…

A: Working capital (WC) seems to be a financial statistic that indicates the operating liquidity…

Q: Net Working Capital is equal to a. Non Current Assets - Current Liabilities b. Non Current Assets -…

A: Current assets are those assets which are easily convertible in to cash or used with in a period of…

Q: A firm's net investment is: a. its enterprise value in excess of debt owed. O b. the market value of…

A: Solution-Company's net investmentThe total amount invested on capital assets minus the price of…

Q: The factor payment for the use of financial capital (loans and equity investments) is called...…

A: The cost of finance: Equity and debt are two sources of capital for any business. Investors who…

Q: Capital Structure components Debt (K) Weighted Cost Total Cost Weights 3.05 25% Common shares (K.)…

A: Weighted average cost of capital is a method of calculating cost of capital in which each category…

Q: eturn on equity b) return on assests c) return on capital

A: Ratio analysis is a method of analyzing a company's liquidity, profitability, and operational…

Q: 1. The formula being used to get the working capital is - a. Working Capital= Current Assets/Current…

A: Solution 1:- As per Bartleby honor code, if multiple questions are posted, the expert is required…

Q: The company cost of capital: measures the return that investors require from the company. is…

A: The company's cost of capital is the return that the investors expect in return for financing the…

Q: Calculate Ndovu plc’s weighted average cost of capital, based on the CAPM computed cost of equity.…

A: Weighted Average Cost of Capital is the cost of capital of the companies considered the cost of all…

Q: Net working capital is defined as: Select one: a. Fixed assets minus long-term liabilities. b.…

A: Net working capital is the measure of company's liquidity and short term financial health.

Q: Capital gearing ratio indicates the relationship between A. assets and capital B. loans and…

A: Capital gearing ratio: Capital gearing ratio refers to the tool to analyze the capital structure of…

Q: MM Approach of Capital Structure is similar to which other approach Net Income Approach O Gross…

A: The Modigliani and Miller Approach (MM Approach) of the capital structure states that the value of…

Q: Debt in the capital structure could be treated as if it were common stock in the weighted average…

A: Debt in the capital structure could be treated as if it were common stock in the weighted average…

Q: Calculate Quick Ratio Operating cash flow to current liabilities Working capital

A: As posted multiple sub parts we are answering only first question kindly repost the unanswered…

Q: Knowledge Check 01 Which of the following describes how working capital is computed? Multiple Choice…

A: Working Capital is the operating liquidity of the company which is available to business or entity.…

Q: Which one of the following is the best indicator of long-term debt paying ability? A)Working…

A: Working capital turnover Working capital turnover is a ratio that measures how efficiently a company…

Q: n equity/capital O D.

A: To find the correct option as,

Q: Net working capital is defined as (select one): A. current assets minus current liabilities.…

A: Net working capital means the amount invested in current assets and current liabilities.

Q: Working capital management refers to a) the management of cash flows b) capital structure c)…

A: Firms may require working capital for various purpose

Q: How to calculate working capital, current assests, current liabilities, quick assets, quick ratio…

Q: 1. Which of the following terms is defined as the mixture of a firm's debt and equity financing? A.…

A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…

Q: Is this a right formula? Market Value of Equity = Market capitalization - cash and investment +…

A: Market value of equity and market capitalization are both same and is calculated as number of shares…

Q: The funds supplied and used by the owner of an enterprise in the expectation that a profit will be…

A: A business raises funds from various sources to make investments and finance operations of the…

Q: Please answer with explanations asset turnover, return on total assets, return on stockholders…

A: Asset Turnover ratio represents the contribution of assets in revenue creation. Return on Assets…

Q: Debt: Debt can be sold at an interest Determine the cost of each capital structure component. •…

A: WACC: It is the cost of capital of the business for raising the different sources of capital. It is…

Q: h. Return on equity J. Compound leverage ratio k. Net cash provided by operating activities %

A: Cash flow from operating activities is the cash flow generated from operations by the firm. The net…

Q: Return on equity measure expected rate on investment of : Equity Assets and equity Both of above

A: Lets understand the meaning of return on equity. Return on equity indicates the how much net income…

Q: 1- If the classic balance sheet formula were written as follows, what would be the net working…

A: Firm require funds for long term (fixed assets) and daily operations. Net working capital (NWC)…

Q: e detail about The weighted average cost of capital up to the point when retained earnings…

A: Since retained profits are more costly than debt and preferred stock, the cost of capital will…

Q: A firm's capital structure can be determined by examining which parts of the firm's balance sheet?…

A: A firm capital structure is generally consist of long term debt ,preferred stock and equity . A firm…

Q: On Cost of Capital (Calculating) * Statement I: The firm's cost of capital is calculated as a…

A: Cost of capital is an important concept in corporate finance which is widely used in the financial…

Q: Question Capital structure refers to how the firm finances its operations and growth through a…

A: Capital structure is the proportion of capital from different sources of finance in the total…

Q: Capital structure refers to Select one: a. Total assets minus Liabilities b. Shareholders' equity c.…

A: The capital structure is how a firm utilizes different sources of finance to fund its operations.

Question

Current assets - current liabilities =

[A] fixed capital
[B] working capital
[C] opening capital
[D] closing capital

Video Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Working capital is an indication of the firms ________. A. asset utilization B. amount of noncurrent liabilities C. liquidity D. amount of noncurrent assets
The cost of equity is _______. A. the interest associated with debt B. the rate of return required by investors to incentivize them to invest in a company C. the weighted average cost of capital D. equal to the amount of asset turnover
Define each of the following terms: Weighted average cost of capital, WACC; after-tax cost of debt, rd(1 – T); after-tax cost of short-term debt, rstd(1 – T) Cost of preferred stock, rps; cost of common equity (or cost of common stock), rs Target capital structure Flotation cost, F; cost of new external common equity, re
Which of the following formulas will correctly calculate Net Working Capital? A. Current assets + current liabilities B. Free cash flow + depreciation expenses C. Incremental earnings – capital purchases D. Current assets – current liabilities
Net working capital is defined as (select one): A. current assets minus current liabilities. B. a ratio measure of liquidity best used in cross-sectional analysis. C. current liabilities minus current assets. D. the portion of the firm's assets financed with short-term funds.
Net working capital is defined as:Select one:a. Fixed assets minus long-term liabilities.b. Current assets minus current liabilities.c. Total liabilities minus shareholders' equity.d. Current liabilities minus shareholders' equity.e. Total assets minus total liabilities.
for the ratio return on capital employed which of the following best describes capital employed : a- share capital b- share capital + reserves c- share capital + current assets d- share capital + fixed assets
Networking capital refers to the A) firms investment in total assets B) firms' investment in current assets C) difference between the firm's current assets and its current liabilities D) Difference between the firms total assets and its total liabilities
The term capital structure refers to_______ O a. Long-term debt, preferred stock, and common stock equity O b. Current assets and current liabilities O c. Shareholders' equity O d. Total assets minus liabilities
A high capital gearing ratio indicates [A] under capitalization [B] over capitalization [C] borrowed capital [D] long term funds
The amounts needed to compute a company's working capital come from which of the following financial statements? Select one:a More than one will be needed b. Balance Sheet c Income Statement d None of the optionse Cashflow statement
The cost of capital includes the cost of equity, the cost of long-term debt and the cost of accounts payable.