Question

At year-end, Rapid Airlines had a negative net working capital of ($4,692) million and current assets of $8,996 million. The firm's current liabilities are: Select one: a. There is not enough information provided to determine the current liabilities.

Answer 1

Using the information given, Rapid Airlines' current liabilities can be calculated as $13,688 million by adding the negative net working capital to the current assets.

Step-by-step explanation:

To determine the current liabilities of Rapid Airlines, we can use the provided information about negative net working capital and current assets. Net working capital is calculated as current assets minus current liabilities. Given that Rapid Airlines has a negative net working capital of ($4,692) million and current assets of $8,996 million, we can set up an equation to solve for current liabilities: Current Assets - Current Liabilities = Net Working Capital; $8,996 million - Current Liabilities = ($4,692) million. Thus, the current liabilities can be calculated as: Current Liabilities = Current Assets - Net Working Capital; Current Liabilities = $8,996 million - (-$4,692 million) = $8,996 million + $4,692 million = $13,688 million.