Selected financial data regarding current assets and current liabilities for Sussex's Line, a competitor in the cruise line industry, isprovided:($ in millions)Current assets:Cash and cash equivalents:Current investmentsNet receivablesInventoryOther current assetsTotal current assetsCurrent liabilities:Accounts payableShort-term debtOther current liabilitiesTotal current liabilities.Current RatioRequired:1. Calculate the current ratio and the acid-test ratio for Sussex's Line. (Enter your answers in millions, not in dollars. For example,$5,500,000 should be entered as 5.5.)Accounts in RatioAcid-Test RatioAccounts in RatioAmounts$40292224106130$954Amounts$1,135669944$2,7480 On August 1, 2024, Trico Technologies, an aeronautic electronics company, borrows $20.6 million cash to expand operations. The loanis made by FirstBanc Corporation under a short-term line of credit arrangement. Trico signs a six-month, 6% promissory note. Interest ispayable at maturity. Trico's year-end is December 31.Required:1. to 3. Record the necessary entries in the Journal Entry Worksheet below for Trico Technologies. (If no entry is required for aparticular transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars, notmillions (i.e. 5.5 million should be entered as 5,500,000).)View transaction list View journal entry worksheet2No123General JournalDateAugust 01, 2024 No Transaction RecordedDecember 31. No Transaction Recorded2024January 31, 2025 No Transaction RecordedDebitCredit

Answered: Selected financial data regarding…

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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Selected financial data regarding current assets and current liabilities for Sussex's Line, a competitor in the cruise line industry, is
provided:
($ in millions)
Current assets:
Cash and cash equivalents:
Current investments
Net receivables
Inventory
Other current assets
Total current assets
Current liabilities:
Accounts payable
Short-term debt
Other current liabilities
Total current liabilities.
Current Ratio
Required:
1. Calculate the current ratio and the acid-test ratio for Sussex's Line. (Enter your answers in millions, not in dollars. For example,
$5,500,000 should be entered as 5.5.)
Accounts in Ratio
Acid-Test Ratio
Accounts in Ratio
Amounts
$402
92
224
106
130
$954
Amounts
$1,135
669
944
$2,748
0

On August 1, 2024, Trico Technologies, an aeronautic electronics company, borrows $20.6 million cash to expand operations. The loan
is made by FirstBanc Corporation under a short-term line of credit arrangement. Trico signs a six-month, 6% promissory note. Interest is
payable at maturity. Trico's year-end is December 31.
Required:
1. to 3. Record the necessary entries in the Journal Entry Worksheet below for Trico Technologies. (If no entry is required for a
particular transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars, not
millions (i.e. 5.5 million should be entered as 5,500,000).)
View transaction list View journal entry worksheet
2
No
1
2
3
General Journal
Date
August 01, 2024 No Transaction Recorded
December 31. No Transaction Recorded
2024
January 31, 2025 No Transaction Recorded
Debit
Credit

Expert Solution

Step 1: Define current and quick ratio:

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Current ratio and acid-test ratio (quick ratio) are the liquidity measures that help the entity to analyze its liquidity position. These are determined using current assets, quick assets and current liabilities.

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