Question
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. (minimum 250 words)
Cash | $ 50,000 | Accounts payable | $ 100,000 |
Inventory | 200,000 | Accruals | 100,000 |
Accounts receivable | 250,000 | Total CL | $ 200,000 |
Total CA | $ 500,000 | Debt | 100,000 |
Net fixed assets | $ 900,000 | Common stock | 200,000 |
| _________ | Retained earnings | 900,000 |
Total assets | $1,400,000 | Total L & E | $1,400,000 |
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