Current Position Analysis The following data were taken from the balance sheet o

Question

Current Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash Marketable securities Accounts and notes receivable (net) Inventories Prepaid expenses $512,600 593,600 242,800 609,200 313,800 $2,272,000 $421,600 474,300 158,100 378,200 241,800 $1,674,000 Total current assets Current liabilities: Accounts and notes payable $411,800 298,200 $710,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place (short-term) $434,000 186,000 $620,000 Accrued liabilities Total current liabilities Current Year Previous Yea 1. Working capital 2. Current ratio 3. Quick ratio 1,562,000V 1,054,000 3.2 2.7 2.1 X

Explanation / Answer

quick ratio = (current assets - inventories - prepayments) / current liabilities

working:

current year quick ratio = (2,272,000 - 313,800 - 609,200) / 710,000

=>1.9

previous year = (1674000-241800-378200) / 620,000

=>1.7

current year previous year quick ratio 1.9 1.7

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.