Question

You find the following financial information about a company: net working capital = $735; fixed assets = $5,385; total assets = $8,190; and long-term debt = $4,281. What are the company's total liabilities?

Answer 1

Company's total liabilities are $6,351.

Explanation:

A company's financial information is given, we have to calculate the company's total liabilities.

Total assets = Fixed assets + current assets

Current assets = Total assets - Fixed assets

= $8,190 - $5,385

= $2,805

Networking capital = Current assets - Current liabilities

$735 = $2,805 - current liabilities

Current liabilities = $2,805 - $735

Current liabilities = $2,070

Total liabilities = Long term debt + current liabilities

= $4,281 + $2,070

= $6,351

Company's total liabilities are $6,351.