NNR Inc.'s balance sheet showed total current assets of $1,875,000 plus $4,225,000 of net fixed assets.All of these assets were required in operations.The firm's current liabilities consisted of $475,000 of accounts payable,$375,000 of 6% short-term notes payable to the bank,and $150,000 of accrued wages and taxes.Its remaining capital consisted of long-term debt and common equity.What was NNR's total investor-provided operating capital?

Question

Quizplus · Accepted Answer

To find the total investor-provided operating capital, add up the total assets and subtract the current liabilities. Total assets = $1,875,000 (current assets) + $4,225,000 (net fixed assets) = $6,100,000. Current liabilities = $475,000 (accounts payable) + $375,000 (notes payable) + $150,000 (accrued wages and taxes) = $1,000,000. Therefore, investor-provided operating capital = $6,100,000 - $1,000,000 = $5,100,000.

NNR Inc'S Balance Sheet Showed Total Current Assets of $1,875,000 Plus