Use the following data to calculate the current ratio.   Eddy Auto Supplies, Balance Sheet, December 31, 2014   Cash $ 84,000 Accounts payable $ 110,000 Accounts receivable 80,000 Salaries and wages payable 20,000 Inventory 140,000 Mortgage payable 180,000 Prepaid insurance 60,000 Total liabilities $310,000 Stock investments 170,000   Land 190,000   Buildings $226,000 Common stock $240,000 Less: Accumulated depreciation (40,000) 186,000 Retained earnings 500,000 Trademarks 140,000 Total stockholders' equity $740,000 Total assets $1,050,000 Total liabilities and stockholders' equity $1,050,000 a. 2.34 : 1   b. 2.80 : 1   c. 3.31 : 1   d. 1.26 : 1

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Use the following data to calculate the current ratio.

 

Eddy Auto Supplies, Balance Sheet, December 31, 2014

 

Cash $ 84,000 Accounts payable $ 110,000

Accounts receivable 80,000 Salaries and wages payable 20,000

Inventory 140,000 Mortgage payable 180,000

Prepaid insurance 60,000 Total liabilities $310,000

Stock investments 170,000  

Land 190,000  

Buildings $226,000 Common stock $240,000

Less: Accumulated depreciation (40,000) 186,000 Retained earnings 500,000

Trademarks 140,000 Total stockholders' equity $740,000

Total assets $1,050,000 Total liabilities and stockholders' equity $1,050,000

a. 2.34 : 1

 

b. 2.80 : 1

 

c. 3.31 : 1

 

d. 1.26 : 1

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