ecoral ansactio Ints, Preparing the ance She lai Balan ng the Current Ratio LO2-2, 2-4, 2-5 wing information applies to the questions displayed below.] astics Company has been operating for three years. At December 31 of last year, the accounting records the following: $20,000 Accounts payable $19,000 ents (short-term) receivable 2,600 6,000 3,300 Accrued liabilities payable 3,600 Notes payable (current) 25,000 Notes payable (noncurrent) 1,500 Common stock y 49,000 eceivable (long-term) 10, 200 nt 91,800 building ples 45,000 Additional paid-in capital 97,000 Retained earnings 4,800 21,600 e current year the company had the following summarized activities:
ecoral ansactio Ints, Preparing the ance She lai Balan ng the Current Ratio LO2-2, 2-4, 2-5 wing information applies to the questions displayed below.] astics Company has been operating for three years. At December 31 of last year, the accounting records the following: $20,000 Accounts payable $19,000 ents (short-term) receivable 2,600 6,000 3,300 Accrued liabilities payable 3,600 Notes payable (current) 25,000 Notes payable (noncurrent) 1,500 Common stock y 49,000 eceivable (long-term) 10, 200 nt 91,800 building ples 45,000 Additional paid-in capital 97,000 Retained earnings 4,800 21,600 e current year the company had the following summarized activities:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information
P2-3 (Algo) Recording Transactions in T-Accounts, Preparing the Balance Sheet from a Trial Balance, and
Evaluating the Current Ratio LO2-2, 2-4, 2-5
[The following information applies to the questions displayed below.]
Jaguar Plastics Company has been operating for three years. At December 31 of last year, the accounting records
reflected the following:
Cash
$20,000 Accounts payable
$19,000
Investments (short-term)
2,600
Accounts receivable
6,000
3,300 Accrued liabilities payable
3,600 Notes payable (current)
25,000 Notes payable (noncurrent)
1,500 Common stock
Inventory
49,000
10, 200
Notes receivable (long-term)
Equipment
45,000 Additional paid-in capital
97,000 Retained earnings
4,800
91,800
21,600
Factory building
Intangibles
During the current year, the company had the following summarized activities:
a. Purchased short-term investments for $8,800 cash.
b. Lent $6,100 to a supplier who signed a two-year note.
c. Purchased equipment that cost $22,000; paid $5,000 cash and signed a one-year note for the balance.
d. Hired a new president at the end of the year. The contract was for $79,000 per year plus options to purchase
company stock at a set price based on company performance. The new president begins her position on January 1
of next year.
e. Issued an additional 1,300 shares of $0.50 par value common stock for $12,000 cash.
f. Borrowed $19,000 cash from a local bank, payable in three months.
g. Purchased a patent (an intangible asset) for $1,700 cash.
h. Built an addition to the factory for $27,000; paid $8,800 in cash and signed a three-year note for the balance.
i. Returned defective equipment to the manufacturer, receiving a cash refund of $3,900.
P2-3 Part 6
6. Compute the current ratio for the current year. (Round your answer to 2 decimal places.)
Current ratio](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F266d5c88-4132-4eca-8561-6ebd3b0393f5%2F07e0994e-d779-4418-bb37-69020ce9db71%2Fe967f7b_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
P2-3 (Algo) Recording Transactions in T-Accounts, Preparing the Balance Sheet from a Trial Balance, and
Evaluating the Current Ratio LO2-2, 2-4, 2-5
[The following information applies to the questions displayed below.]
Jaguar Plastics Company has been operating for three years. At December 31 of last year, the accounting records
reflected the following:
Cash
$20,000 Accounts payable
$19,000
Investments (short-term)
2,600
Accounts receivable
6,000
3,300 Accrued liabilities payable
3,600 Notes payable (current)
25,000 Notes payable (noncurrent)
1,500 Common stock
Inventory
49,000
10, 200
Notes receivable (long-term)
Equipment
45,000 Additional paid-in capital
97,000 Retained earnings
4,800
91,800
21,600
Factory building
Intangibles
During the current year, the company had the following summarized activities:
a. Purchased short-term investments for $8,800 cash.
b. Lent $6,100 to a supplier who signed a two-year note.
c. Purchased equipment that cost $22,000; paid $5,000 cash and signed a one-year note for the balance.
d. Hired a new president at the end of the year. The contract was for $79,000 per year plus options to purchase
company stock at a set price based on company performance. The new president begins her position on January 1
of next year.
e. Issued an additional 1,300 shares of $0.50 par value common stock for $12,000 cash.
f. Borrowed $19,000 cash from a local bank, payable in three months.
g. Purchased a patent (an intangible asset) for $1,700 cash.
h. Built an addition to the factory for $27,000; paid $8,800 in cash and signed a three-year note for the balance.
i. Returned defective equipment to the manufacturer, receiving a cash refund of $3,900.
P2-3 Part 6
6. Compute the current ratio for the current year. (Round your answer to 2 decimal places.)
Current ratio
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