Which of the following factors would cause the least amount of concern about a company's ability to continue as a going-concern?
A)Excessive reliance on debt financing.
B)Loss of key personnel without comparable replacement.
C)Inadequate maintenance of long-lived assets.
D)Declining profit margins.

Question

Quizplus · Accepted Answer

The going-concern (also called the continuity)assumption means that a business is assumed to be capable of continuing its operations long enough to meet its obligations.A company's profit margins may decrease due to increased competition or higher costs.It means that stockholders will have to accept a lower return on their investment.It does not necessarily mean that the company will go out of business.

Which of the Following Factors Would Cause the Least Amount