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Jobston, Inc.The balance sheet of Jobston Inc. includes the following items:

Cash $ 22,400
Accounts receivable $11,700
Inventory $23,300
Prepaid insurance $1,040
Land $80,000
Accounts payable $47,500
Salaries payable $1,200
Capital stock $84,040
Retained earnings $5,700

Read the information about Jobston, Inc. What is Jobston's working capital?

a. $89,740
b. $9,740
c. $58,440
d. $84,040

User Wilhelmina
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1 Answer

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Final answer:

Jobston, Inc.'s working capital is calculated by subtracting current liabilities from current assets. It's found to be $9,740, which is option b.

Step-by-step explanation:

To calculate Jobston, Inc.'s working capital, we need to subtract the current liabilities from the current assets.

Current assets include cash, accounts receivable, inventory, and prepaid insurance. So, the total current assets of Jobston, Inc. are $22,400 + $11,700 + $23,300 + $1,040 = $58,440.

Current liabilities include accounts payable and salaries payable. So, the total current liabilities of Jobston, Inc. are $47,500 + $1,200 = $48,700. Now, we can calculate the working capital by subtracting the current liabilities from the current assets: $58,440 - $48,700 = $9,740.

Therefore, Jobston, Inc.'s working capital is $9,740.

To calculate Jobston Inc.'s working capital, we need to subtract its current liabilities from its current assets. Current assets for Jobston, Inc. include Cash ($22,400), Accounts receivable ($11,700), Inventory ($23,300), and Prepaid insurance ($1,040), totaling to $58,440. Current liabilities comprise Accounts payable ($47,500) and Salaries payable ($1,200), which total to $48,700. By subtracting the liabilities from the assets, Jobston Inc.'s working capital is $58,440 - $48,700 = $9,740.

User Prakhar Mishra
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