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LO 5.3 If current assets are $100,000 and current liabilities are $42,000, what is the working capital?Choose one answer from the options below.A. 200 percentB. 50 percentC. 2.0D. $58,000

Question

LO 5.3 If current assets are 100,000andcurrentliabilitiesare100,000 and current liabilities are 42,000, what is the working capital?Choose one answer from the options below.A. 200 percentB. 50 percentC. 2.0D. $58,000

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Solution

The working capital is calculated as the difference between current assets and current liabilities.

Step 1: Identify the current assets and current liabilities. In this case, current assets are 100,000andcurrentliabilitiesare100,000 and current liabilities are 42,000.

Step 2: Subtract the current liabilities from the current assets to find the working capital.

100,000(currentassets)100,000 (current assets) - 42,000 (current liabilities) = $58,000

So, the working capital is $58,000.

Therefore, the correct answer is D. $58,000.

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