Which of the following items would normally be excluded from the computation of working capital?
A) Advances from customers for goods that will be shipped three months after the balance sheet date
B) The portion of long-term debt that matures six months after the balance sheet date and will be paid from the regular cash account
C) Prepaid insurance
D) Cash surrender value of life insurance

Question

Quizplus · Accepted Answer

The cash surrender value of life insurance is typically considered a non-current asset and is not included in the computation of working capital, which focuses on current assets and liabilities.

Which of the Following Items Would Normally Be Excluded from the Computation