RST has provided the following information in 000's on selected cash transactions for 2014: What is the increase in working capital for the year ended December 31,2014,as a result of the above information?

Question

RST has provided the following information in 000's on selected cash transactions for 2014:  What is the increase in working capital for the year ended December 31,2014,as a result of the above information?

Quizplus · Accepted Answer

In order to calculate the increase in working capital, we need to find the difference between current assets and current liabilities for 2014 and 2013. Using the given information, we can calculate the following:

Current Assets for 2014: $30,000 + $4,000 = $34,000
Current Assets for 2013: $30,000
Increase in Current Assets: $34,000 - $30,000 = $4,000

Current Liabilities for 2014: $19,000 + $10,400 = $29,400
Current Liabilities for 2013: $23,800
Decrease in Current Liabilities: $23,800 - $29,400 = -$5,600

Increase in Working Capital = Increase in Current Assets - Decrease in Current Liabilities
Increase in Working Capital = $4,000 - (-$5,600)
Increase in Working Capital = $9,600

Therefore, none of the given choices are correct. The correct answer is: 
Answer: None of these choices are correct.

RST Has Provided the Following Information in 000's on Selected