Hi could you please answer this question as fast as possible? My test is timed.

Question

Hi could you please answer this question as fast as possible? My test is timed.

Simon Company's year-end balance sheets follow 217 2016 2015 At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets $27,212 $32,123 $ 31, 216 42,462 44,775 3,433 196,614 $ 456,653 $ 393,666 $ 318, 500 77, 307 98,180 8,590 245,364 56,767 74,285 8,267 222, 224 Liabilities and Equity Accounts payable Long-term notes payable secured by $ 115,981 $65,864$41, 201 mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity 68,277 162,500 46, 522 $ 456,653 $ 393,666 $ 318, 500 88,426 162,50e 89,746 92, 354 162,50e 72,948 1. Compute the current ratio for the year ended 2017, 2016, and 2015. 2. Compute the acid-test ratio for the year ended 2017, 2016, and 2015.

Explanation / Answer

CURRENT RATIO: Current Assets / Current Liabilities

ACID - TEST RATIO = Cash + Accounts Receivables / Current liabilities

Quick Assets does not include inventory and prepaid expenses.

YEAR NUMERATOR / DENOMINATOR = CURRENT RATIO 2017 211,289 / 115,981 = 1.82:1 2016 171,442 / 65,864 = 2.60:1 2015 121,886 / 41,201 = 2.95:1

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