Question

In: Finance

Westerman Inc. started the financial year 2015 with $1968 in current assets and $1348 in current...

Westerman Inc. started the financial year 2015 with $1968 in current assets and $1348 in current liabilities. The corresponding ending figures were $1992 and $1350. What was the change in net working capital during the year 2015?

Select one:

a. $22

b. $24

c. $2

d. $28

Solutions

Expert Solution

Net working capital is a relative measure between current asset and current liabilities. It is difference between current asset and current liabilities of a company. Net working capital gives a measure of the liquidity position and operational efficiency. An increase in net working capital reflect in reduction in cash position and vice versa.           

Given:

Starting at 2015: Current asset= $ 1968, Current liabilities = $ 1348

Net working capital opening = Current Asset – Current Liabilities

                                    = $ 1968 - $ 1348 = $ 620

At end of 2015: Current asset = $ 1992, Current liabilities = $ 1350

Net working capital closing = Current Asset – Current Liabilities

                                                  = $ 1992 - $ 1350 = $ 642

Change in Net working capital = Closing net working capital – Opening Net working capital

                                                       = $ 642 - $ 620 = $ 22

Answer: a. $ 22

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets       Current...
The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets       Current assets            Cash & cash equivalents            Account receivables            Inventory            Other current assets                Total current assets      L.T. Assets           PPE                Total Assets Liabilities & Shareholders’ Equity       Current liabilities             Accounts payable             Current maturities of notes payable             Accrued expenses             Other current liabilities                    Total current liabilities       L.T. Liabilities              Bank loans                     Total liabilities Shareholders’...
CONSOLIDATED BALANCE SHEET (millions of dollars) 2016 2015 Assets 2016 2015 Current assets 2016 2015 Cash...
CONSOLIDATED BALANCE SHEET (millions of dollars) 2016 2015 Assets 2016 2015 Current assets 2016 2015 Cash and cash equivalents 3,657 3,705 Notes and accounts receivable 21,394 19,875 Inventories: Crude oil, products and merchandise 10,877 12,037 Materials and supplies 4,203 4,208 Other current assets 1,285 2,798      Total current assets 41,416 42,623 Crude oil, products and merchandise inventories are carried at the lower of current market value or cost (generally determined under the last-in, first-out method – LIFO). Inventory costs include...
Blue Fin started the current year with assets of $702,000,liabilities of $351,000 and common stock...
Blue Fin started the current year with assets of $702,000, liabilities of $351,000 and common stock of $202,000. During the current year, assets increased by $402,000, liabilities decreased by $51,000 and common stock increased by $277,000. There was no payment of dividends to owners during the year.Use the information above to answer the following question. What was the amount of Blue Fin's net income for the year?a.$176,000b.$453,000c.$226,000d.$277,000
1. Blue Fin started the current year with assets of $716,000, liabilities of $358,000 and common...
1. Blue Fin started the current year with assets of $716,000, liabilities of $358,000 and common stock of $216,000. During the current year, assets increased by $416,000, liabilities decreased by $58,000 and common stock increased by $291,000. There was no payment of dividends to owners during the year. Based on this information, what was the amount of Blue Fin's retained earnings at the beginning of the year? 2. Blue Fin started the current year with assets of $711,000, liabilities of...
ABC Inc had current assets of $67,200 and current liabilities of $71,100 last year. This year,...
ABC Inc had current assets of $67,200 and current liabilities of $71,100 last year. This year, the current assets are $83,100 and the current liabilities are $85,100. The depreciation expense for the past year is $9,600 and the interest paid is $8,700. What is the amount of the change in net working capital? $1,900 $2,800 $1,400 $2,100 −$1,400
(Financial statement​ analysis) The annual sales for​ Salco, Inc. were $4.58 million last year. Current assets...
(Financial statement​ analysis) The annual sales for​ Salco, Inc. were $4.58 million last year. Current assets $505,000 Liabilities $1,009000    Net fixed assets 1,513,000 ​Owners' equity $1,009,000 Total Assets $2,018,000 Total $2,018,000 Salco's income statement for the year was as​ follows Sales $4,580,000 ​Less: Cost of goods sold (3,507,000) Gross profit $1,073,000 ​Less: Operating expenses (492,000) Net operating income $581,000 ​Less: Interest expense (109,000) Earnings before taxes $472,000 ​Less: Taxes ​(35 %35%​) (165,200) Net income $306,800    Please Show Work....
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets...
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets       Current assets            Cash & cash equivalents            Account receivables            Inventory            Other current assets                Total current assets      L.T. Assets           PPE                Total Assets Liabilities & Shareholders’ Equity       Current liabilities             Accounts payable             Current maturities of notes payable             Accrued expenses             Other current liabilities                    Total current liabilities       L.T. Liabilities              Bank loans                     Total...
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets...
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets       Current assets            Cash & cash equivalents            Account receivables            Inventory            Other current assets                Total current assets      L.T. Assets           PPE                Total Assets Liabilities & Shareholders’ Equity       Current liabilities             Accounts payable             Current maturities of notes payable             Accrued expenses             Other current liabilities                    Total current liabilities       L.T. Liabilities              Bank loans                     Total...
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets...
Question 1 The following are the financial statements of Rigolo Inc. Balance sheet 20116 2015 Assets       Current assets            Cash & cash equivalents            Account receivables            Inventory            Other current assets                Total current assets      L.T. Assets           PPE                Total Assets Liabilities & Shareholders’ Equity       Current liabilities             Accounts payable             Current maturities of notes payable             Accrued expenses             Other current liabilities                    Total current liabilities       L.T. Liabilities              Bank loans                     Total...
In December 2015​, Apple had cash of $38.02 billion, current assets of$75.99 ​billion, and current...
In December 2015, Apple had cash of $38.02 billion, current assets of $75.99 billion, and current liabilities of $75.91 billion. It also had inventories of $2.45 billion.a. What was Apple's current ratio?b. What was Apple's quick ratio?c. In January 2016,Hewlett-Packard had a quick ratio of 0.66 and a current ratio of 0.90.What can you say about the asset liquidity of Apple relative to Hewlett-Packard?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT