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Compute: Net Operating Working Capital

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Question: A company has the following balance sheet. What is its net operating working capital?

Cash: $ 10
Accounts payable: $ 20
Short-term investments: 20
Accruals: 30
Accounts receivable : 30
Notes payable: 20
Inventory: 40
Current liabilities: 70
Current assets: 100
Long-term debt: 30
Net fixed assets: 80
Common equity: 10
Retained earnings: 70
Total assets: $180
Total liability & equity: $180

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This solution is comprised of a brief, but concise response which illustrates how to calculate the net operating working capital value.

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Current Assets = Cash + Short term investments+Accounts receivables+ ...

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