4. Technology Systems has the following balance sheet. Assume that all current assets are used in operations. How much net operating working capital does the firm have? Also, how important is net operation working capital to a company? Cash Accounts receivable Inventory Current assets Net fixed assets Total assets $ 100 650 550 $1,300 $1,000 $2,300 Accounts payable Accruals Notes payable Current liabilities Long-term debt Common equity Retained earnings Total liab. & equity $ 200 110 590 $ 900 600 300 500 $2,300
4. Technology Systems has the following balance sheet. Assume that all current assets are used in operations. How much net operating working capital does the firm have? Also, how important is net operation working capital to a company? Cash Accounts receivable Inventory Current assets Net fixed assets Total assets $ 100 650 550 $1,300 $1,000 $2,300 Accounts payable Accruals Notes payable Current liabilities Long-term debt Common equity Retained earnings Total liab. & equity $ 200 110 590 $ 900 600 300 500 $2,300
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Step 1: Introduction
Working capital is the difference between a company's current assets and its current liabilities. It represents the amount of cash and other resources a company has available to fund its day-to-day operations. Working capital is an important measure of a company's short-term financial health and its ability to meet its current obligations.
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