Desola cobola, a business man has the following assets and liabilities as at 01/01/07 Le stock 120,000 fixtures 335,000 Debtors 111,000 Overdraft 27,000 mac...
Question 1 Report
| Le | |
| stock | 120,000 |
| fixtures | 335,000 |
| Debtors | 111,000 |
| Overdraft | 27,000 |
| machinery | 348,000 |
| motor vehicles | 232,000 |
| cash | 82,000 |
| creditors | 101,000 |
From the above information, calculate the following:
(a) Total fixed assets
(b) Total current assets
(c) Total current liabilities
(d) The working capital
(e) The capital employed
Answer Details
Desola Cobola as at 01/01/07
| Item | Le | Classification |
|---|---|---|
| Fixtures | 335,000 | Fixed asset |
| Machinery | 348,000 | Fixed asset |
| Motor vehicles | 232,000 | Fixed asset |
| Stock | 120,000 | Current asset |
| Debtors | 111,000 | Current asset |
| Cash | 82,000 | Current asset |
| Overdraft | 27,000 | Current liability |
| Creditors | 101,000 | Current liability |
(a) Total fixed assets = Fixtures + Machinery + Motor vehicles
= 335,000 + 348,000 + 232,000 = Le915,000
(b) Total current assets = Stock + Debtors + Cash
= 120,000 + 111,000 + 82,000 = Le313,000
(c) Total current liabilities = Overdraft + Creditors
= 27,000 + 101,000 = Le128,000
(d) Working capital = Current assets - Current liabilities
= 313,000 - 128,000 = Le185,000
(e) Capital employed = Fixed assets + Working capital
= 915,000 + 185,000 = Le1,100,000
(Check: Total assets - Current liabilities = 1,228,000 - 128,000 = Le1,100,000.)
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