Data pertaining to the current position of Boole Company are as follows:
Cash ................ $240,000
Temporary investments ......... 120,000
Accounts and notes receivable (net) ... 360,000
Inventories .............. 380,000
Prepaid expenses ............ 20,000
Accounts payable .......... 140,000
Notes payable (short-term) ....... 200,000
Accrued expenses ........... 60,000
(a) The working capital,
(b) The current ratio, and
(c) The quick ratio. Round to one decimal place.
2. List the following captions on a sheet of paper:
Transition Working Capital Current Ration Quick Ratio
Compute the working capital, the current ratio, and the quick ratio after each of the following transactions, and record the results in the appropriate columns. Consider each transaction separately and assume that only that transaction affects the data given above. Round to one decimal place.
(a) Sold temporary investments at no gain or loss, $45,000.
(b) Paid accounts payable, $80,000.
(c) Purchased goods on account, $50,000.
(d) Paid notes payable, $100,000.
(e) Declared a cash dividend, $80,000.
(f) Declared a common stock dividend on common stock, $22,500.
(g) Borrowed cash from bank on a long-term note, $200,000.
(h) Received cash on account, $67,500.
(i) Issued additional shares of stock for cash, $400,000.
(j) Paid cash for prepaid expenses, $40,000.
This question was answered on: Jul 11, 2017
Need a similar solution fast, written anew from scratch? Place your own custom order
We have top-notch tutors who can help you with your essay at a reasonable cost and then you can simply use that essay as a template to build your own arguments. This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student. New solution orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.