Which Factor Listed Is NOT a Good Indicator of Potential

Multiple Choice

Which factor listed is NOT a good indicator of potential financial failure?

A) The client is constantly short of cash and working capital.
B) The client has had increasing net losses for several years.
C) The client's retained earnings were reduced by half as a result of a large dividend payout.
D) The client relies heavily on debt financing, especially by financing permanent assets with short-term loans.