Fellsmere Corporation
Presented Below Are the Condensed Balance Sheets of Fellsmere

Essay

Fellsmere Corporation
Presented below are the condensed balance sheets of Fellsmere Corporation at December 31,2018 and 2017.Net income for the years ending December 31,2018 and 2017 is $346,000 and $109,000,respectively.
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$\begin{array}{lrr}&\text { December 31, } 2018&\text { December 31, } 2017\\\text { Current assets } & \$ 2,228,186 & \$ 2,544,683 \\\text { Property, plant, and equipment } & 530,589 & 376,647 \\\text { (net) } & 131,206 & 118,121\\\text { Total assets }&\$ 2,889,981&\$ 3,039,451\\\\\text { Current liabilities } & \$ 1,429,674 & \$ 1,003,906 \\\text { Long-term obligations } & 3,360 & 7,240 \\\text { Warranty and other liabilities } & 112,971 & 98,081 \\\quad \text { Total liabilities } & \$ 1,546,005 & \$ 1,109,227\\\text { Stockhol ders' equity: }\\\text { Common stock } & \$ 1,566 & \$ 501,631 \\\text { Additional paid-in capital } & 365,986 & 799,483 \\\text { Retained earnings } & 980,509 & 634,509\\\text { Accumulated other }&(4,085) & (5,399) \\\text { comprehensive loss }\\\text { Total stockholders' equity } & \$ 1,343,976 & \$ 1,930,224 \\\text { Total liabilities and stockholders' } & \$ 2,889,981 & \$ 3,039,451\\\text { equity }\end{array}$
-Read the information about Fellsmere Corporation.
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Required
(A)Explain the change in Fellsmere's working capital from 2017 to 2018.Why do users believe the current ratio provides more information than the dollar amount of working capital? Explain.
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(B)Fellsmere Corporation's creditors need to know whether its working capital position improved during the year.How would you evaluate this?