Your firm has total assets of $4,900, fixed assets of $3,200, long-term debt of $2,900, and short-term debt of $1,400. What is the amount of net working capital?
A) −$100
B) $300
C) $600
D) $1,700
E) $1,800

Question

Quizplus · Accepted Answer

Net working capital is calculated as current assets minus current liabilities. Current assets can be found by subtracting fixed assets from total assets, which gives $4,900 - $3,200 = $1,700. Current liabilities in this case are the short-term debt, which is $1,400. Therefore, net working capital is $1,700 - $1,400 = $300.

Your Firm Has Total Assets of $4,900, Fixed Assets of $3,200