CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

Assume U.S. GAAP. The following information is available from the accounting records of a company as of 31 December 2016 (all figures in $ thousands):

Accounts payable: 20
Accounts receivable: 82
Bank loan, due on demand: 44
Cash: 12
Income taxes payable: 5
Inventory: 47
Investments accounted for by the equity method: 112
Loan payable, due 30 June 30 2018: 50
Deposits from customers for deliveries in 2017: 8

The working capital for the company (in $ thousands) is closest to:
A. 48
B. 64
C. 72
Explanation: Current Assets: Cash 12 + Accounts receivable 82 + Inventory 47 = 141

Current Liabilities: Bank loan, due on demand 44 + Accounts payable 20 + Income taxes payable 5 + Deposits from customers for deliveries in 2013 8 = 77

Working capital (CA - CL): 64.0

User Contributed Comments 2

User Comment
unknown why the deposit from customers are not an current asset?
Florian16 Unearned revenue is a liability not an asset. Deposit from customers = unearned revenue
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