The assets of River & Stone Corp. include current assets, property, plant and equipment and it does not have excess cash (Free Cash). It has assets valued at $4 million and its fixed assets are valued at $3 million. It reports payables of $350,000, long-term debt of $650,000 and stockholders' equity of $2 million. Its balance sheet reflects that it has accounts payable and accrued debts. Generally, the company operates on a debt and stockholders' equity basis. 1. Determine the total amount of the company's debt. 2. Calculate the balance of current assets and current liabilities. 3. Determine the net working capital of the company.
B. Balance Sheet
The assets of River & Stone Corp. include current assets, property, plant and equipment and it does not have excess cash (Free Cash). It has assets valued at $4 million and its fixed assets are valued at $3 million. It reports payables of $350,000, long-term debt of $650,000 and
1. Determine the total amount of the company's debt.
2. Calculate the balance of current assets and current liabilities.
3. Determine the net
4. Calculate the net working capital.
5. Explain how net working capital and operating working capital can support managerial decisions and strategic goals.
NOTE: YOU ANSWERED 1, 2, 3 BUT NEEDS TO ANSWER 4 AND 5.
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