Change in net working capital calculation Samuels Manufacturing is considering the purchase of a new machine...

Transcribed Image Text:

Change in net working capital calculation Samuels Manufacturing is considering the purchase of a new machine to replace one it believes is obsolete. The firm has total current assets of $915,000 and total current liabilities of $632,000. As a result of the proposed replacement, the following changes are anticipated in the levels of the current asset and current liability accounts noted. Account Accruals Change + $40,000 Marketable securities Inventories 0 -16,000 Accounts payable +89,000 Notes payable 0 Accounts receivable +147,000 Cash +10,000 Change in net working capital calculation Samuels Manufacturing is considering the purchase of a new machine to replace one it believes is obsolete. The firm has total current assets of $915,000 and total current liabilities of $632,000. As a result of the proposed replacement, the following changes are anticipated in the levels of the current asset and current liability accounts noted. Account Accruals Change + $40,000 Marketable securities Inventories 0 -16,000 Accounts payable +89,000 Notes payable 0 Accounts receivable +147,000 Cash +10,000