A company has current assets of $587,000 and current liabilities of $228,000. The board of directors declares a cash dividend of $170,000. a. What is the current ratio after the declaration but before payment? b. What is the current ratio after the payment of the dividend?

A company has current assets of $587,000 and current liabilities of $228,000. The board of directors declares a cash dividend of $170,000. a. What is the current ratio after the declaration but before payment? b. What is the current ratio after the payment of the dividend?

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter7: Financial Activities

Section: Chapter Questions

Problem 2CIC

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Question

Please need answer the following requirements for this accounting question

A company has current assets of $587,000 and current
liabilities of $228,000. The board of directors declares a cash
dividend of $170,000.
a. What is the current ratio after the declaration but before
payment?
b. What is the current ratio after the payment of the dividend?

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