Which of the following does not demonstrate evidence regarding the ability to consummate a refinancing of short-term debt?
A) Management indicated that they are going to refinance the obligation.
B) Actually refinance the obligation.
C) Have capacity under existing financing agreements that can be used to refinance the obligation.
D) Enter into a financing agreement that clearly permits the entity to refinance the obligation.

Question

Quizplus · Accepted Answer

While management indicating a plan to refinance short-term debt may be a positive sign, it does not demonstrate actual evidence of the ability to consummate the refinancing. The other options all provide evidence of the ability to consummate the refinancing: actually completing the refinancing (B), having available capacity to do so under existing financing agreements (C), or entering into a financing agreement that permits the refinancing (D).

Which of the Following Does Not Demonstrate Evidence Regarding the Ability