Dumont Corporation is preparing its 2014 statement of financial position. The company records show the following related amounts at the end of the fiscal year, December 31, 2014:

Required:
1. Compute
(a) The amount of working capital
(b) The quick ratio (show computations).
Why is working capital important to management? How do financial analysts use the quick ratio?
2. Would your computations be different if the company reported $ 250,000 worth of contingent liabilities in the notes to its financial statements? Explain.

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Cash Short term investments Trade receivables Inventories Prepayments Non-curent assets Notes payable (896, due in 5 years) Trade payables Income taxes payable 6,000 14,000 180,000 14,000 6,000 24,000 3,200 200,000 25,000 Liability for withholding taxes 54,000 Deferred ent revenue 147,000 Bonds payable (due in 15 years) 110,000 Wages payable 2,000 296,200 30,000 Property taxes payable Note payable (696; due in 6 months) Interest payable 119,000 Shareholders'equity 28,000