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Po16

Po16

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Po16.
Norsk Optronics, ALS, of Bergen, Norway, had a current ratio of 2 on June 30 of the current year. On that date, the company's assets were: Cash Accounts receivable, net Inventory Prepaid expenses Plant and equipment, net Total assets Required: 1. What was the company's working capital on June 30? 2. What was the company's acid-test ratio on June 30? (Round your answer to 2 decimal places.) 3. The company paid an account payable of $41,000 immediately after June 30. $ 70,000 370,000 680,000 10,000 1,720,000. $ 2,850,000 a. What effect did this transaction have on working capital? b. What effect did this transaction have on the current ratio? (Round your intermediate calculations to 1 decimal place.) 1. Working capital 12 Acid-test ratio 3a Effect on working capital 3b. Effect on current ratio.
Transcribed Image Text:Norsk Optronics, ALS, of Bergen, Norway, had a current ratio of 2 on June 30 of the current year. On that date, the company's assets were: Cash Accounts receivable, net Inventory Prepaid expenses Plant and equipment, net Total assets Required: 1. What was the company's working capital on June 30? 2. What was the company's acid-test ratio on June 30? (Round your answer to 2 decimal places.) 3. The company paid an account payable of $41,000 immediately after June 30. $ 70,000 370,000 680,000 10,000 1,720,000. $ 2,850,000 a. What effect did this transaction have on working capital? b. What effect did this transaction have on the current ratio? (Round your intermediate calculations to 1 decimal place.) 1. Working capital 12 Acid-test ratio 3a Effect on working capital 3b. Effect on current ratio.
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