As of December 31, Crown Company had $14,000 in assets, $10,000 in common stock, and $3,000 in retained earnings. The total amount of liabilities on that date is:

a. $27,000

b. $13,000

c. $4,000

d. $1,000

If a firm's cash flow from assets (free cash flow) is negative during a year, this implies that:

a. The firm is at the verge of financial distress (bankruptcy)

b. The firm is generating more cash from its operations than it is investing in its assets in that year

c. Creditors and shareholders are investing more cash into the firm than the firm is paying to them

d. Management is not making the best use of shareholder investment