Ojo's Balance sheet as at 31st Dec 2006 \[ \begin{array}{|l|r|l|r|} \hline & \#
Ojo's Balance sheet as at 31st Dec 2006
\[
\begin{array}{|l|r|l|r|}
\hline
& \#
Follow
Ojo's Balance sheet as at 31st Dec 2006
\[
\begin{array}{|l|r|l|r|}
\hline
& \# & & \# \\
\hline
Capital & 10,000 & Land \& building & 12,000 \\
Drawings & 600 & Fittings & 850 \\
& 9,400 & Motor vans & 1,600 \\
Profit & 6,200 & Cash & 2,150 \\
& 15,600 & Prepayments & 700 \\
Creditors & 1,800 & Debtors & 100 \\
& 17,400 & & 17,400 \\
\hline
--- & & & \\
\hline
\end{array}
\]
What is Ojo's working capital?
Explanation
Working capital = Current Assets - Current Liabilities. Current Assets = Cash (2,150) + Prepayments (700) + Debtors (100) = 2,950. Current Liabilities = Creditors (1,800). Working capital = 2,950 - 1,800 = 1,150. Correct option is D.
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