Which one of the following statements concerning net working capital is correct?
- The lower the value of net working capital the greater the ability of a firm to meet its current obligations.
- An increase in net working capital must also increase current assets.
- Net working capital increases when inventory is sold for cash at a profit.
- Firms with equal amounts of net working capital are also equally liquid.
Which one of the following statements concerning net working capital is correct?Answer:Net working capital increases when inventory is sold for cash at a profit.
19. Which one of the following statementsconcerning net working capital is correct?A.The lower the value of net working capital the greater the ability of a firm to meet its current obligations.B.An increase in net working capital must also increase current assets.C.Net working capital increases when inventory is sold for cash at a profit.D.Firms with equal amounts of net working capital are also equally liquid.E.Net working capital is a part of the operating cash flow.
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