Summary QuestionWhen a company reports negative net cash flows from operations, which of the fo
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Grado
ACC 205
Institución
Ashford University
When a company reports negative net cash flows from operationsQuestionWhen a company reports negative net cash flows from operations, which of the following information is more relevant to help the firm stay proactive? C ratio of equity to annual cash expenses O ratio of equity to monthly cas...
when a company reports negative net cash flows fro
which of the following information is more releva
understanding its liquidity and ability to cover
providing a more granular v
Escuela, estudio y materia
Ashford University
ACC 205
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Question
When a company reports negative net cash flows from operations, which of the
following information is more relevant to help the firm stay proactive? C ratio
of equity to annual cash expenses O ratio of equity to monthly cash expenses O
ratio of cash to monthly cash expenses ratio of accounts payable to annual
financing expenses O all of the above can be used
Answer & Explanation
When a company reports negative net cash flows from operations,
understanding its liquidity and ability to cover expenses is crucial. Let's evaluate
each option:
1. Ratio of equity to annual cash expenses: This ratio helps assess how
long the company can sustain its operations using its equity if it continues
to have negative cash flows.
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