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Hi I need some help with solving this Accosting equation relating to Balance sheets. Thank-you! ;) From the information provided below, determine if the company
Hi I need some help with solving this Accosting equation relating to Balance sheets. Thank-you! ;)
From the information provided below, determine if the company would be approved for a bank loan. As of October 1st, Ottawa Craft Breweries has a cash balance of $100,000. It owes money to a supplier for $250,000 that must be paid within 60 days. The company also has inventory of $700,000. It has an outstanding notes payable of $1.5 million, of which $100,000 is due within the the next 12 months. The book value of the PPE is $3.6 million. The company also has a government tax bill of $50,000 due by December 31st. The company's balance sheet also reveals shareholders' equity of $1 million. o None of the responses are correct. o No, the company will likely not be approved for a loan as the working capital is a negative $350,000. O Yes, the company will likely be approved for a loan as the working capital is a positive $500,000. o Yes, the company will likely be approved for a loan as the working capital is a positive $400,000 o No, the company will likely not be approved for a loan as the working capital is a negative $450,000.
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