CURRENT ASSETS AND CURRENT LIABILITIES
OF UNITED STATES CorporatioNS
WORKING CAPITAL OF U.S. CORPORATIONS, SEPTEMBER 30, 1957
The net working capital of U. S. corporations increased $700 million in
the third quarter and as of September 30, 1957 amounted to $107.7 billion ac-
cording to the latest estimates made public by the Securities and Exchange
Commission. The quarterly advance in working capital was due to a gain of
$4.3 billion in current assets which was offset to a large extent by an increase
of $3.6 billion in current liabilities.
Except for a small decline in the receivables from the U. S. Government
account, all items of current assets indicated gains, mostly small, for the
quarter. Both the accounts receivable and inventories accounts were at new
high levels of $92.9 billion and $80.0 billion, respectively. Accounts
receivable, with the manufacturing, trade and finance groups sharing equally
in the increase, were higher by $2.4 billion for the quarter and accounted for
over half the expansion in current assets. Inventories at the end of the
quarter were higher by $700 million reflecting the seasonal increase reported
by the trade group. Manufacturing firms had a drop of $300 million in
inventories, the first quarterly decline in three years.
Corporate holdings of cash and deposits and U. S. Government securities
amounted to $49.3 billion, or an increase of $1.0 billion for the quarter with
about $700 million of this gain in cash and deposits. The ratio of these two
forms of liquid funds to total current liabilities at the end of September
was 41 percent, unchanged from three months earlier.
All the principal current liability accounts also showed increases in
the third quarter of 1957. Corporate Federal income tax liabilities were
estimated to total $13.8 billion, a gain of $1.6 billion for the quarter.
Increases of $800 million and $1.2 billion were made in trade notes and accounts
payable, and other current liabilities, respectively.
Changes in net working capital during the third quarter among the
major industry groups were small. The trade and manufacturing groups each
had increases of around $400 million, while other groups had smaller changes
which had the effect of offsetting each other.
In addition to the $700 million increase in working capital in the
third quarter of this year, corporations invested $8.3 billion in plant and
equipment. Of this $9.0 billion of corporate expansion, about 70 percent
continued to come from internal sources retained profits and depreciation
accruals. External financing provided the balance of the funds needed and
consisted of $2.2 billion in long-term borrowings and $300 million in in net
stock offerings.
The accompanying table gives the aggregate estimate of current assets
and liabilities of all U. S. corporations.