Question

What financial situation does an entity face if it is

Q: Answer-What financial situation does an entity face if it is described as having negative working capital?

Negative working capital indicates that a company has more short-term financial obligations than assets available to meet those obligations, pointing to potential liquidity issues.

described as having negative working capital?

A Its total assets exceed total liabilities.

B It is free of debt.

C Its current liabilities surpass its current assets.

D It holds significant long-term investments.

E Its cash flow is positive.

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PNB SO Credit Officer Scale 1

What financial situation does an entity face if it is

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