For the year, B&K United increased current liabilities by $1,400, decreased cash by $1,200, increased net fixed assets by $340, increased accounts receivable by $200, and decreased inventory by $150. What is the annual change in net working capital?

Question

Quizplus · Accepted Answer

The annual change in net working capital is calculated as the change in current assets minus the change in current liabilities. In this case, the change in current assets is $200 (increase in accounts receivable) - $150 (decrease in inventory) = $50. The change in current liabilities is $1,400. Therefore, the annual change in net working capital is $50 - $1,400 = -$1,350.

For the Year, B&K United Increased Current Liabilities by $1,400