Question

Given the information in the table below, what is the long-term capital for this firm?

Revenues - $5,000,000
Net income - $500,000
Current assets - $1,800,000
Non-current assets - $2,450,000
Current liabilities - $450,000
Long-term debt - $200,000
Total assets - $4,250,000
Total shareholders equity - $3,600,000

(A) $3,800,000
(B) $650,000
(C) $2,450,000

Answer 1

The long-term capital for the firm is the sum of the long-term debt and the total shareholders' equity, which amounts to A) $3,800,000.

Step-by-step explanation:

To calculate the long-term capital for the firm given the information in the table, we need to add the long-term debt to the total shareholders' equity. The long-term debt is given as $200,000 and the total shareholders' equity is $3,600,000. Adding these two figures gives us the long-term capital:

$200,000 (Long-term debt) + $3,600,000 (Total shareholders' equity) = $3,800,000

Therefore, the long-term capital for this firm is $3,800,000, which corresponds to option (A).