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Consider the balance sheet of Wikileaks Industries as shown below. Because Wikileaks has $900,000 of retained earnings, do you think that the company would be
Consider the balance sheet of Wikileaks Industries as shown below. Because Wikileaks has $900,000 of retained earnings, do you think that the company would be able to pay cash to buy an asset with a cost of $300,000? Why or why not? Give logical arguments to support your answer. Cash Inventory Accounts receivable Total CA Net fixed assets $ 50,000 Accounts payable 200,000 Accruals 250,000 Total CL $ 500,000 Debt $ 900,000 Common stock Retained earnings $1.400.000 Total L & E $ 100,000 100,000 $ 200,000 100,000 200,000 900,000 $1.400.000 Total assets
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