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    Carle's Ltd's statement of financial position as of December 31, 2021 showed a working capital deficit of $634,000 due to current assets of $1215 being less than current liabilities of $1849. Total assets of $10185 plus current assets exceeded total liabilities of $6475, giving net assets of $4925. Although the company had an overall asset surplus, the working capital deficit indicates it needs a bank loan to continue operating, and since it sells demanded food and clothing, the bank could offer a $25,000 loan as the company's income is guaranteed.

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    Carle's Ltd's statement of financial position as of December 31, 2021 showed a working capital deficit of $634,000 due to current assets of $1215 being less than current liabilities of $1849. Total assets of $10185 plus current assets exceeded total liabilities of $6475, giving net assets of $4925. Although the company had an overall asset surplus, the working capital deficit indicates it needs a bank loan to continue operating, and since it sells demanded food and clothing, the bank could offer a $25,000 loan as the company's income is guaranteed.

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    © All Rights Reserved
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    60 views1 page

    Carle

    Uploaded by

    akiko
    Carle's Ltd's statement of financial position as of December 31, 2021 showed a working capital deficit of $634,000 due to current assets of $1215 being less than current liabilities of $1849. Total assets of $10185 plus current assets exceeded total liabilities of $6475, giving net assets of $4925. Although the company had an overall asset surplus, the working capital deficit indicates it needs a bank loan to continue operating, and since it sells demanded food and clothing, the bank could offer a $25,000 loan as the company's income is guaranteed.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    Carle’s Ltd’s statement of financial position Prep-b

    M.Tsolmon

    1. Working capital = Current asset-current liability

    -634=1215-1849 Worling capital= -634

    2.((Total Fixed Assets + Total Current Assets) – (Total Current Liabilities + Total Long Term Liabilities))=
    Net assets.

    (10185+1215)-(1849+4626)=4925 Net assets=4925

    3. If we look at the statement of financial position for Carle Ltd, 31 December 2021,

    Total assets are 10183>Total liability is 6475. Therefore the bank offers 25$ to this Ltd is guaranteed.
    But the working capital deficit is -634000$ in a year, so this company needs a bank loan. And in this case,
    mentioned they sell food and clothes. These are all demanded things so this company’s income is
    guaranteed. Therefore bank could offer them.

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