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JAMB Principles of Accounts 2020 Question 18

Question 18

Interpretation of Accounts

Use the information below to answer questions 17 and 18
(₦)
Total current assets 2000
Total fixed assets 4000
Current liabilities 1200
Drawings 200
Long term loan 2000
What is the net working capital?

  1. A.₦1800
  2. B.₦800
  3. C.₦2600
  4. D.₦600
Show the answer and explanation

Answer: B (₦800)

Explanation

Working capital = current assets − current liabilities = 2,000 − 1,200 = ₦800.