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3 June, 17:49

6. Kroeger Exporters has total assets of $74,300, net working capital of $22,900, owners' equity of $38,600, and long-term debt of $23,900. What is the value of the current assets

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  1. 3 June, 19:12
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    Current assets = $34,700.

    Explanation:

    We know,

    Total assets = Current assets + Non current assets (property, plan and equipment).

    Again, total assets = Liabilities + Owners equity

    Again,

    Liabilities = Current liabilities + Long term liabilities.

    Finally, net working capital = Current assets - Current liabilities

    Given,

    Total assets = $74,300

    net working capital = $22,900

    owners' equity = $38,600

    long-term debt = $23,900

    Putting the values into the formulas,

    Total assets = Liabilities + Owners equity

    or, $74,300 = Liabilities + $38,600

    or, Liabilities = $74,300 - $38,600

    Liabilities = $35,700.

    Again,

    Liabilities = Current liabilities + Long term liabilities.

    or, $35,700 = Current liabilities + $23,900

    or, Current liabilities = $35,700 - $23,900

    Current liabilities = $11,800.

    Therefore, Net working capital = Current assets - Current liabilities

    or, $22,900 = Current assets - $11,800

    or, Current assets = $22,900 + $11,800

    Current assets = $34,700.
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