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1 January, 13:18

Use the following data to answer QuestionAccounts payable $30,000Accounts receivable 65,000Accrued liabilities 7,000Cash 20,000Intangible assets 40,000Inventory 72,000Long-term investments 100,000Long-term liabilities 75,000Marketable securities 36,000Notes payable (short-term) 20,000Property, plant, and equipment 625,000Prepaid expenses 2,000

1. Based on the above data, what is the amount of quick assets? a. $163,000b. $195,000c. $121,000d. $56,0002. Based on the above data, what is the amount of working capital? a. $238,000b. $138,000c. $178,000d. $64,000

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  1. 1 January, 13:30
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    Current (quick) assets: $195,000

    Working capital: $138,000

    Explanation:

    We can find the correct answer by laying out the information appropriately:

    Current Assets:

    Accounts Receivable: $65,000

    Cash: $20,000

    Inventory: $72,000

    Marketable securities: $36,000

    Prepaid expenses: $2,000

    Total: $195,000

    Current Liabilities:

    Accounts payable: $30,000

    Accrued liabilities: $7,000

    Notes payable (short-term) : $20,000

    Total: $57,000

    Working capital = current assets - current liabilities

    Working capital = $195,000 - $57,000

    = $138,000

    The following accounts mentioned in the question are non-current assets: intangible assets, long-term investments, and property, plant and equipment.

    And long-term liabilities, as the name implies, is classified as a non-current liability.
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