Blauser's started the year with $280 in cash,$924 in inventory,$361 in accounts payable,$1,687 in equipment,and $414 in accounts receivable.At year's end,the firm had $311 in cash,$1,594 in equipment,$1,003 in inventory,$426 in accounts receivable,and $398 in accounts payable.What was the change in net working capital during the year?
A)−$860
B)$191
C)$85
D)−$94
E)−$206

Question

Quizplus · Accepted Answer

Net working capital is calculated as current assets minus current liabilities. At the start of the year, net working capital was ($280 + $924 + $414) - $361 = $1,257. At the end of the year, it was ($311 + $1,003 + $426) - $398 = $1,342. The change in net working capital is $1,342 - $1,257 = $85.

Blauser's Started the Year with $280 in Cash,$924 in Inventory,$361