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WAEC Commerce 1995 Question 42

Question 42

Business Calculations

What is the working capital of KO Ltd which has N3,500 in fixed assets, cash balance of N4,170, trade debtors N1,150 and sundry creditors of N1,800?

  1. A.N7,020.00
  2. B.N5,320.00
  3. C.N4,720.00
  4. D.N3,620.00
  5. E.N3,520.00
Show the answer and explanation

Answer: E (N3,520.00)

Explanation

Working capital = current assets − current liabilities = (N4,170 + N1,150) − N1,800 = N3,520. Fixed assets are left out.