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From the following balance sheet accounts, Construct a balance sheet for 2013 and 2014 List all...

  1. From the following balance sheet accounts,
  1. Construct a balance sheet for 2013 and 2014
  2. List all the working capital accounts
  3. Find the net working capital for the years ending 2013 and 2014
  4. Calculate the change in net working capital for the year 2014

Account

Balance 12/31/2013

Balance 12/31/2014

Accounts payable

$1000

$1100

Accounts receivable

$2480

$2690

Cash

$1300

$1090

Common stock

$4990

$4990

Inventory

$5800

$6030

Long-term debt

$7800

$8200

Three-month Notes payable

$ 800

$ 960

Plant, property, and equipment

$6380

$6530

Retained earnings

$1370

$1090

Solutions

Expert Solution

Answer of Part b:

The working Capital accounts are Cash, Accounts Receivable, Inventory, Accounts Payable and three month notes payable

Answer of Part c:

For 2013:

Net Working Capital = Current Assets – Current Liabilities
Net Working Capital = $9,580 - $1,800
Net Working Capital = $7,780

For 2014:

Net Working Capital = Current Assets – Current Liabilities
Net Working Capital = $9,810 - $2,060
Net Working Capital = $7,750

Answer of Part d:

Change in Net Working Capital = Ending Working Capital – Beginning Working Capital
Change in Net Working Capital = $7,750 - $7,780
Change in Net Working Capital = -$30

jeff jeffy answered 1 month ago
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