Consider the balance sheet of Wilkes Industries as shown below. Because Wilkes has $800,000 of retained earnings, the company would be able to pay cash to buy an asset with a cost of $200,000.
Cash$ 50,000
Accounts payable$ 100,000
Inventory200,000
Accruals 100,000
Accounts receivable 250,000
Total CL$ 200,000
Total CA$ 500,000
Debt200,000
Net fixed assets$ 900,000
Common stock200,000
_________
Retained earnings 800,000
Total assets$1,400,000
Total L & E$1,400,000
Answer the following statement true (T) or false (F)
False
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