If the current assets are $250000 and the current liabilities are $135500, then the working capital would be ___________?
Correct answer: D. $114,500
- A. $3,855,500
- B. $314,500
- C. $214,500
- D. $114,500
Explanation
Working capital is found by deducting current liabilities from current assets: $250,000 − $135,500 = $114,500. A positive result indicates that current assets exceed current liabilities.
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About Financial Statements
Financial statements present a business's financial performance and position through the income statement, statement of financial position, cash flow statement and changes in equity. Questions involve preparing and interpreting these statements, adjusting entries, depreciation, closing inventory, accrued and prepaid items, and distinguishing profit from cash flow.
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