Finance Exam 2

A firm decreased its current assets and increased its current liabilities over the last year. As a result, the firm’s net working capital:

had to decrease

The accounting statement that measures the revenues, expenses, and net income of a firm over a period is called the:

Income Statement

Net working capital includes

An invoice from a supplier

Net income increases if:

revenue increases

Given a profitable firm, depreciation:

Lowers taxes

Sharehoders’’’ equity is best defined as:

The residual value of a firm