Calculating Net Working Capital

[Hilde]

Good day to all, I have a question about Net Working Capital. I know how to calculate Net working capital using the balance sheet figures. Unfortunately I came across a question that I seriously need help with! I need to calculate the net working capital but the only information available is the Inventory of R100,000, the current ratio of 1.2 and the quick ratio of 1.1.

Can someone PLEASE help me with this!!

 

[kirby]

First create formulas for all your variables
NWC = CA - CL
Current ratio. CA / CL = 1.2 and so on
Then use your 5th grade algebra to solve by isolating the variables
This type of problem teaches more about algebra than it does about ratios and I don't think it belongs in a financial course for that reason