Question

10. Regarding current assets (CA) which of the following is true? A. CA are the most...

10. Regarding current assets (CA) which of the following is true?

A. CA are the most liquid assets.

B. CA are the least profitable assets.

C. Both "A" and "B" are true.

D. Neither "A" or "B" is true.

12. Which of the following is the best definition of retained earnings?

A. It is how much a company earned during the past year.

B. it is how much a company made in the most current year less dividends paid

C. it is the accumulation of profits and losses from when the company started less any dividends that were paid since inception.

D. all of the above are correct.


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Homework Answers

Answer #1

Answer 10)

Current Assets are considered as the most liquid assets. As these assets are easily liquidated because they have least conversion time.

Current Assets are profitable For instance. Accrued Income and Investory.

Option A is correct.

Answer 12)

Retained Earnings are earnings which is acculumated by the company year by year after paying all the dividends. It is shown as on date. i.e. It does not belong to one single period. It is as on date balance.

Option C is correct.

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