At the end of the current year, what is this company\'s current ratio? Income St

ID: 2404940 • Letter: A

Question

At the end of the current year, what is this company's current ratio?

Income Statement ($000s) Balance Sheet ($000s)

2017 2016 2017 2016

Revenues $ 200 $175 Cash $ 10 $150

Cost of Goods Sold 110 100 Accounts Receivable 30 40

Operating Expenses 30 28 Inventory 20 40

Interest Expense 20 12 Plant, Property, Equipment 180 200

Net Income 40 35 Total Assets $ 240 $430

Dividends 20 20 Accounts Payable $ 15 $ 25

Bank Debt Due in 6 Months 15 50

Long term Debt 80 245

Common Stock 60 60

Retained Earnings 70 50

Total Liabilities & Equity $ 240 $430

The company has 1,000,000 shares of common stock authorized, 500,000 shares issued, and 200,000 outstanding as of both 12/31/2017 and 12/31/2016.

2.0

Answer: 2.00 Calculation: Current ratio = Current assets/Current liabilities = (10+30+20)/((15+15) = 2.00

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