In: Finance
Saunders Corp. has a book net worth of $11,150. Long-term debt is $2,300. Net working capital, other than cash, is $2,950. Fixed assets are $2,750 and current liabilities are $1,500. |
Required: |
(a) | How much cash does the company have? |
(Click to select) 9,250 10,700 8,400 9,528 8,972 |
(b) | What is the value of the current assets? |
(Click to select) 13,015 4,450 14,385 13,426 13,700 |
Compute the total liabilities, using the equation as shown below:
Total liabilities = Net worth + Long-term liabilities + Current liabilities
= $11,150 + $2,300 + $1,500
= $14,950
Hence, the total liabilities is $14,950.
Compute the current assets other than cash, using the equation as shown below:
Current assets = Net working capital + Current liabilities
= $2,950 + $1,500
= $4,450
Hence, the current assets other than cash is $4,450.
Compute the total current assets, using the equation as shown below:
Total current assets = Total liabilities – Fixed assets
= $14,950 - $2,750
= $12,200
Hence, the total current assets are $12,200.
(a)
Compute the cash balance, using the equation as shown below:
Cash = Total current assets – Current assets other than cash
= $12,200 - $4,450
= $7,750
Hence, the cash balance is $7,750.
(b)
Compute the total current assets, using the equation as shown below:
Total current assets = Total liabilities – Fixed assets
= $14,950 - $2,750
= $12,200
Hence, the total current assets are $12,200.