The 2010 balance sheet of Greystone, Inc., showed current assets of $3,150 and c

Question

The 2010 balance sheet of Greystone, Inc., showed current assets of $3,150 and current liabilities of $1,630. The 2011 balance sheet showed current assets of $3,000 and current liabilities of $1,605.

What was the company’s 2011 change in net working capital, or NWC? (Negative amount should be indicated by a minus sign.)

The 2010 balance sheet of Greystone, Inc., showed current assets of $3,150 and current liabilities of $1,630. The 2011 balance sheet showed current assets of $3,000 and current liabilities of $1,605.

Explanation / Answer

Net working capital =current asset -current liabilities

2010 ,Net working capital = 3150 -1630

                                        = $ 1520

2011 ,net working capital =3000 -1605

                                     = $1395

change in net working capital = 1395 - 1520

                                              = - $ 125

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