The following balance sheet information is provided for Duke Company for Year 2:**Assets:**- Cash: $5,400- Accounts receivable: $15,500- Inventory: $18,800- Prepaid expenses: $1,600- Plant and equipment, net of depreciation: $20,200- Land: $19,550**Total assets:** $80,650**Liabilities and Stockholders' Equity:**- Accounts payable: $4,500- Salaries payable: $11,500- Bonds payable (due in ten years): $10,000- Common stock, no par: $30,000- Retained earnings: $24,650**Total liabilities and stockholders’ equity:** $80,650**Question:**What is the company's current ratio?**Note:** Round your answer to 2 decimal places.**Multiple Choice Options:**- ○ 1.56- ○ 2.53- ○ 1.31- ● 3.79The current ratio can be calculated by dividing total current assets by total current liabilities.

The ratio analysis helps to analyze the Financial statements of the business. The current ratio is calculated as current assets divided by current liabilities. Current assets = Cash + accounts receivable + inventory + prepaid expenses = 5,400 + 15,500 + 18,000 + 1,600 = $40,500Current liabilities = Accounts payable + salaries payable = 4,500 + 11,500 = $16,000Current ratio = Current assets / Current liabilities = 40,500/16,000 = 2.53Option b. 2.53 is correct value for current ratio.

Business

Accounting

The following balance sheet information is provided for Duke Company for Year 2: Assets Cash Accounts receivable Inventory Prepaid expenses Plant and equipment, net of depreciation Land Total assets Liabilities and Stockholders' Equity Accounts payable Salaries payable Bonds payable (due in ten years) Common stock, no par Retained earnings Total liabilities and stockholders' equity What is the company's current ratio? Note: Round your answer to 2 decimal places. Multiple Choice O 116 2.53 131 379 $5,400 15,508 18,008 1,608 20,200 19,950 $ 80,658 $ 4,500 11,500 19,000 30,000 15,650 $ 80,650 < Prev 13 of 15 Next > ♡

The following balance sheet information is provided for Duke Company for Year 2: Assets Cash Accounts receivable Inventory Prepaid expenses Plant and equipment, net of depreciation Land Total assets Liabilities and Stockholders' Equity Accounts payable Salaries payable Bonds payable (due in ten years) Common stock, no par Retained earnings Total liabilities and stockholders' equity What is the company's current ratio? Note: Round your answer to 2 decimal places. Multiple Choice O 116 2.53 131 379 $5,400 15,508 18,008 1,608 20,200 19,950 $ 80,658 $ 4,500 11,500 19,000 30,000 15,650 $ 80,650 < Prev 13 of 15 Next > ♡

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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