a company with working capital of $720,000 and a current ratio of 2.2 pays a $125,000 short-term liability. the amount of working capital immediately after payment is

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The amount of working capital, just immediately after the payment goes through, is $ 720, 000.

What is the working capital ?

The difference between a company's current assets and its current liabilities is known as working capital, sometimes known as net working capital (NWC). It's a frequently employed metric to assess an organization's immediate health.

A corporation that has sufficient working capital is able to finance both its ongoing operations and its expansion plans.

The fact that a short - term liability was paid for, means it was paid using cash. This means that the current assets and the current liabilities both reduced by the same amount of $ 125, 000. The working capital therefore remains $ 720, 000.

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