Purchase Solution

Carl's Bail Bonds: Calculate change in net working capital and net cash flow.

Not what you're looking for?

Ask Custom Question

Please help with the following problem regarding working capital management.

Last year, Carl's Bail Bonds reported sales of $58,200 and costs of $22,700. The following information was also reported for the same period:

Beginning Accounts Receivable: $24,880
Ending Accounts Receivable: $21,520
Beginning Inventory: 4,270
Ending Inventory: 6,512
Beginning Accts Payable: 40,680
Ending Accts Payable: 44,540

Based on this information, what was Carl's change in net working capital for last year? What was the net cash flow?

Purchase this Solution

Solution Summary

The solution walks through the methodology of computing the change in working capital and cash flows. It is mostly narrative explaining the concepts, but the amounts for the problem are also computed. Step by step calculations are given.

Solution Preview

Net working capital (NWC) is defined as the difference between current assets and current liabilities. Change in NWC, therefore, is NWC2 - NWC1.

In this problem, the only information we have is regarding accounts receivable, inventory, and ...

Purchase this Solution

Free BrainMass Quizzes
Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

Paradigms and Frameworks of Management Research

This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.

Operations Management

This quiz tests a student's knowledge about Operations Management