Canyon tours showed the following components of working capital last year: beginning of year end of year accounts receivable "$ 25,200" $ 23,600 inventory 12,600 13,700 accounts payable 15,100 17,700 a. what was the change in net working capital during the year? (a negative amount should be indicated by a minus sign.) b. if sales were $36,600 and costs were $24,600, what was cash flow for the year? ignore taxes.

a. - $3,100

b. $17,300

Explanation:

Changes in working capital = (ending balance of current assets - ending balance of current liabilities) - (beginning balance of current assets - beginning balance of current liabilities)

where,

Beginning current assets = Account receivable + inventory

                                          = $25,200 + $12,600

                                          = $37,800

Ending current assets = Account receivable + inventory

                                    = $23,600 + $13,700

                                    = $37,300

And, the current liabilities is given

= ($37,300 - $17,700) - ($37,800 - $15,100)

= $19,600 - $22,700

= - $3,100

b. The computation of the cash flow is shown below:

= Sales - costs + decrease in accounts receivable - increase in inventory + increase in accounts payable

= $36,600 - $24,600 + $1,600 - $1,100 + $2,600

= $17,300

The decrease and increase in current assets and liabilities shows a difference between the beginning and ending year amounts

answer; correct answer is investing activity;