Loose Leaf for Fundamental Accounting Principles
Loose Leaf for Fundamental Accounting Principles
23rd Edition
ISBN: 9781259687709
Author: John J Wild, Ken Shaw Accounting Professor, Barbara Chiappetta Fundamental Accounting Principles
Publisher: McGraw-Hill Education
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Chapter 17, Problem 6DQ
To determine

Concept Introduction:

Working capital: Working capital can be defined as the excess of the current assets over the current liabilities. It is a measure of both a company’s operational efficiency and its short-term financial health. Working capital can be calculated as under –

Working Capital = Total current assets  Total current liabilities

To discuss:

Why working capital is given special attention in the process of analysing balance sheets.

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Tatum Company has four products in its inventory. Information about ending inventory is as follows: Product Total Cost Total Net Realizable Value 101 $ 146,000 $ 113,000 102 108,000 123,000 103 73,000 63,000 104 43,000 63,000 Required: Determine the carrying value of ending inventory assuming the lower of cost or net realizable value (LCNRV) rule is applied to individual products. Assuming that inventory write-downs are common for Tatum Company, record any necessary year-end adjusting entry.
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Chapter 17 Solutions

Loose Leaf for Fundamental Accounting Principles

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Working capital explained; Author: The Finance Storyteller;https://www.youtube.com/watch?v=XvHAlui-Bno;License: Standard Youtube License