The current ratio of a company is 6:1 and its acid-test ratio is 1:1. If the inventories and prepaid items amount to $546,000, what is the amount of current liabilities? $109200 Current Liabilities   $enter current liabilities in dollars

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Answer each of the questions in the following unrelated situations.

(a) The current ratio of a company is 6:1 and its acid-test ratio is 1:1. If the inventories and prepaid items amount to $546,000, what is the amount of current liabilities? $109200

Current Liabilities  
$enter current liabilities in dollars


(b) A company had an average inventory last year of $180,000 and its inventory turnover was 5. If sales volume and unit cost remain the same this year as last and inventory turnover is 8 this year, what will average inventory have to be during the current year? (Round answer to 0 decimal places, e.g. 125.)

Average Inventory  
$enter the average inventory in dollars rounded to 0 decimal places


(c) A company has current assets of $92,000 (of which $37,000 is inventory and prepaid items) and current liabilities of $37,000. What is the current ratio? What is the acid-test ratio? If the company borrows $14,000 cash from a bank on a 120-day loan, what will its current ratio be? What will the acid-test ratio be? (Round answers to 2 decimal places, e.g. 2.50.)

Current Ratio
 
enter the ratio rounded to 2 decimal places
 :1
Acid Test Ratio
 
enter the ratio rounded to 2 decimal places
 :1
New Current Ratio
 
enter the ratio rounded to 2 decimal places
 :1
New Acid Test Ratio
 
enter the ratio rounded to 2 decimal places
 :1


(d) A company has current assets of $560,000 and current liabilities of $233,000. The board of directors declares a cash dividend of $169,000. What is the current ratio after the declaration but before payment? What is the current ratio after the payment of the dividend? (Round answers to 2 decimal places, e.g. 2.50.)

Current ratio after the declaration but before payment
 
enter the ratio rounded to 2 decimal places
 :1
Current ratio after the payment of the dividend
 
enter the ratio rounded to 2 decimal places
 :1
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