Answer:
The value of the net working capital to total assets ratio is 0.5067≅0.51
Explanation:
Given Data:
Accounts payable =$2,214
Inventory= $7,950
Cash=$1,263
Fixed Asset=$8,400
Accounts receivable=$3,907
Long-term debt=$4,200
Required:
The value of the net working capital to total assets ratio=?
Solution:
Net working Capital=Inventory+Cash+Accounts receivable-Accounts payable
Net working Capital= $7,950+$1,263+$3,907-$2,214
Net working Capital= $10,906.
Total assets=Inventory+Cash+Accounts receivable+ Fixed assets
Total assets= $7,950+$1,263+$3,907+$8,400
Total assets=$21,520
Ratio=[tex]\frac{Net\ working\ Capital}{Total\ assets}[/tex]
[tex]Ratio=\frac{\$10,906}{\$21,520} \\Ratio=0.5067[/tex]
The value of the net working capital to total assets ratio is 0.5067≅0.51.
