Knowledge Check 01Which of the following describes how working capital is computed?Multiple ChoiceCurrent assets Current liabilitiesCurrent liabilities Current assetsCurrent assets-Current liabilitiesCurrent assets + Noncurrent liabilities

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

Answered: Knowledge Check 01 Which of the…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter2: Introduction To Financial Statements

Section: Chapter Questions

Problem 17MC: Working capital is an indication of the firms ________. A. asset utilization B. amount of noncurrent...

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Discuss ANY TWO (2) factors that affect the cost of capital or weighted average cost of capital (WACC) in investment appraisal. (2 marks)
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
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.
Solve for CDL’s current cost of equity and weighted average cost of capital. Show all relevant workings.
Suppose the HomeNet's Cost of Capital is12%, use NPV, IRR, MIRR, PI, PP and DPPinvestment appraisal methods to analyse thisforecasted FCFs. Interpret your investment decisions madeaccording to the rules mentioned
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
Out of which equation is NOT CORRECT ? Please remember to select "WHICH IS NOT CORRECT" Select one: a. Capital = Total Assets - Total Liabilities b. Total Assets = Tangible Assets + Intangible Assets + Investments + Current Assets c. Total Liabilities = Total Assets - Shareholder's funds - Capital d. Owner's equity = Share capital + Reserve and Surplus
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
Working capital is an indication of the firm’s ________.A. asset utilizationB. amount of noncurrent liabilitiesC. liquidityD. amount of noncurrent assets
Explain how the financing of working capital can be arranged in terms of short and long term sources of finance. In particular, make reference to: i) The financing of working capital or net current assets when short term sources of finance are exhausted ii) The distinction between fluctuating and permanent current assets.
Distinguish between the following measures of invested capital, and briefly explain when each should be used: (a) total assets, (b) total productive assets, and (c) total assets less current liabilities.
LO1 - Describe the specific elements of the balance sheet (assets, liabilities, and owners’ equity), and prepare a balance sheet with assets and liabilities properly classified into current and noncurrent categories. A balance sheet contains the following classifications: (a) Current assets (b) Investments (c) Property, plant, and equipment (d) Intangible assets (e) Other noncurrent assets (f) Current liabilities (g) Long-term debt (h) Other noncurrent liabilities (i) Capital stock (j) Additional paid-in capital (k) Retained earnings Indicate by letter how each of the following accounts would be classified. Place a minus sign (-) for all accounts representing offset or contra balances. Discount on Bonds Payable Stock of Subsidiary Corporation 3.12% Bonds Payable (due in six months) U.S. Treasury Bills Income Taxes Payable Sales Taxes Payable Estimated Claims under Warranties for Service and Replacements Par Value of Stock Issued and Outstanding Unearned Rent Revenue (six months…

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Knowledge Check 01 Which of the following describes how working capital is computed? Multiple Choice Current assets Current liabilities Current liabilities Current assets Current assets-Current liabilities Current assets + Noncurrent liabilities