Which of the following BEST defines solvency?
A) being able to pay debts when they become due
B) managing money in the optimum way
C) earning more money than the previous year
D) assuring that gains outweigh losses
E) predicting revenues, costs, and expenses accurately
Answer: A
Explanation: A) To be solvent is to be in a position to pay debts when they become due, as opposed to being insolvent, which is often associated with bankruptcy.
You might also like to view...
For tax purposes a life insurance dividend is considered
A) a partial return of premium and is therefore not taxed. B) the same as a stock dividend. C) the same as a capital gain. D) an adjustment to gross income.
A popular extension of materials requirement planning is manufacturing resource planning II, which integrates data from numerous areas such as finance, accounting, marketing, engineering, and manufacturing using a sophisticated computer system
Indicate whether the statement is true or false