IronClad Devices Ltd. has current assets of $630,000 and current liabilities of $250,000. The board of directors declares a cash dividend of $190,000. a. What is the current ratio after the declaration but before payment? b. What is the current ratio after the payment of the dividend?

IronClad Devices Ltd. has current assets of $630,000 and current liabilities of $250,000. The board of directors declares a cash dividend of $190,000. a. What is the current ratio after the declaration but before payment? b. What is the current ratio after the payment of the dividend?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter21: The Statement Of Cash Flows

Section: Chapter Questions

Problem 7GI

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Question

I am looking for the correct answer to this financial accounting problem using valid accounting standards.

IronClad Devices Ltd. has current assets of $630,000 and current
liabilities of $250,000. The board of directors declares a cash
dividend of $190,000.
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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