Peterson Company has current liabilities of $210,000 and working capital of $56,000. Its current assets, therefore, must equal $266,000.

Question

Quizplus · Accepted Answer

Working capital is calculated as current assets minus current liabilities. Therefore, we can calculate the current assets by adding the working capital to the current liabilities as follows:

Current assets = Working capital + Current liabilities 
Current assets = $56,000 + $210,000 
Current assets = $266,000

Therefore, the statement is true.

Peterson Company Has Current Liabilities of $210,000 and Working Capital