Sherwood, Inc., the parent company of Tasty snack foods and Super beverages, had
ID: 2575805 • Letter: S
Question
Sherwood, Inc., the parent company of Tasty snack foods and Super beverages, had the following current assets and current liabilities at the end of two recent years:
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Year(in millions) Previous Year
(in millions) Cash and cash equivalents $1,724 $1,749 Short-term investments, at cost 1,224 3,248 Accounts and notes receivable, net 3,892 3,331 Inventories 2,280 2,280 Prepaid expenses and other current assets 760 843 Short-term obligations 304 3,227 Accounts payable and other current liabilities 7,197 6,579 Income taxes payable 99 604
Explanation / Answer
a.
Current Year
(in millions)
Previous Year
(in millions)
Current Year
(in millions)
Previous Year
(in millions)
Current Year
(in millions)
Previous Year
(in millions)
Current ratio = Total current assets ÷ Total current liabilities
Quick ratio = Quick assets ÷ Total current liabilities
Current Year
(in millions)
Previous Year
(in millions)
Cash and cash equivalents $1,724 $1,749 Short term investments, at cost 1,224 3,248 Accounts and notes receivable, net 3,892 3,331 Inventories 2,280 2,280 Prepaid expenses and other current assets 760 843 Total current assets $9,880 $11,451Related Questions
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