Question 6 In 2016, Southwest Airlines had negative net working capital of $(2,3
ID: 2816400 • Letter: Q
Question
Question 6
In 2016, Southwest Airlines had negative net working capital of $(2,346) million and current assets of $4,498 million.
The firm’s current liabilities are:
$2,152 million
$6,844million
$2,346 million
$5,236 million
Question 7
Which of the following is a cash flow from operating activities?
Sale of long-term investments in common stock.
Purchase of merchandise for resale.
Payment of a note payable.
D Sale of a piece of land no longer used in operations.
Question 8
How would cash collected on accounts receivable affect the balance sheet?
Increase liabilities and decrease equity
Decrease liabilities and increase equity
Increase assets and decrease assets
Increase assets and increase equity
Question 10
Which of the following accounts would NOT be involved in preparing the income statement?
Depreciation expense
Accumulated depreciation
Provision for taxes
Interest income
$2,152 million
$6,844million
$2,346 million
$5,236 million
Explanation / Answer
6)
Current assets – Current liabilities = Net working capital
Current liabilities = Current assets – Net working capital
= $4,498-(-$2,346)
= $6,844 million
Hence, correct option is $6,844 million
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