Use this balance sheet and income statement to answer the following question.Use ending balances whenever average balances are required for computing ratios. $\begin{array}{c}
\text {Abner Systems, Inc.}\
\text {Income Statement}\
\text {For the Year Ended December 31, 2010}\\begin{array}{lr}
\text { Net sales } & \$ 24,000 \
\text { Costs of goods sold } & \underline{8,000} \
\text { Gross margin } & \$ 16,000 \
\text { Operating expenses } & \underline{8,000}\
\text { Income before income taxes }&\$8,000 \
\text { Income taxes }& \underline{3,200}\
\text {Net income } & \$4,800
\end{array}\end{array}$ The total amount of working capital of Abner Systems is

Question

Use this balance sheet and income statement to answer the following question.Use ending balances whenever average balances are required for computing ratios.  $\begin{array}{c}
\text {Abner Systems, Inc.}\
\text {Income Statement}\
\text {For the Year Ended December 31, 2010}\\begin{array}{lr}
\text { Net sales } & \$ 24,000 \
\text { Costs of goods sold } &  \underline{8,000} \
\text { Gross margin } & \$ 16,000 \
\text { Operating expenses } &  \underline{8,000}\
\text { Income before income taxes }&\$8,000 \
\text { Income taxes }& \underline{3,200}\
 \text {Net income } & \$4,800 
\end{array}\end{array}$ The total amount of working capital of Abner Systems is

Quizplus · Accepted Answer

Working capital is calculated as current assets minus current liabilities. From the balance sheet, current assets are $12,000 and current liabilities are $10,000. Therefore, working capital is $12,000 - $10,000 = $2,000.

Use This Balance Sheet and Income Statement to Answer the Following