A firm that has a series of negative earnings, sales declines and workforce reductions is likely headed to:

Question

Quizplus · Accepted Answer

Negative earnings, sales declines, and workforce reductions are all indicators of financial distress. Therefore, the firm is likely headed towards financial difficulties such as bankruptcy, liquidation, or restructuring. The other options such as acquisition, merger or new financing are unlikely as they require a financially stable and successful company.

A Firm That Has a Series of Negative Earnings, Sales