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Accounting for IGCSE & O level - Final Statements (Section 4 - No. 38)

If a business has negative working capital, what does this indicate?
The business has more current assets than current liabilities.
The business has more current liabilities than current assets.
The business has a very high level of liquidity.
The business is highly profitable.

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Negative working capital means that current liabilities exceed current assets.

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