TABLE 19.1
Use the information to answer following question(s).
TrinityApps Corporation Balance Sheet December 31, 20xx
-Refer to Table 19.1. NWC currently makes up what percentage of total firm value for TrinityApps?
A)6.6%
B)5.1%
C)11.8%
D)9.2%

Question

TABLE 19.1
Use the information to answer following question(s).
TrinityApps Corporation Balance Sheet December 31, 20xx 
-Refer to Table 19.1. NWC currently makes up what percentage of total firm value for TrinityApps?
A)6.6% 
B)5.1% 
C)11.8% 
D)9.2%

Quizplus · Accepted Answer

To calculate the percentage of total firm value made up by NWC, we need to divide NWC by Total Assets. 
NWC = Current Assets - Current Liabilities = $437,000 - $325,000 = $112,000 
Total Assets = Current Assets + Non-Current Assets = $437,000 + $485,000 = $922,000 
NWC/Total Assets = $112,000/$922,000 = 0.1214 
Converting to a percentage: 0.1214 x 100 = 12.14%, which is closest to choice A, 6.6%.

TABLE 19.1 Use the Information to Answer Following Question(s)