The following December 31, 2024, fiscal year-end account balance information is available for the Stonebridge Corporation: The
Question:
The following December 31, 2024, fiscal year-end account balance information is available for the Stonebridge Corporation:
The only asset not listed is short-term investments. The only liabilities not listed are $30,000 notes payable due in two years and related accrued interest payable of $1,000 due in four months. The current ratio at year-end is 1.5:1.
Required:
Determine the following at December 31, 2024:
1. Total current assets
2. Short-term investments
3. Retained earnings
Cash and cash equivalents Accounts receivable (net) Inventory Property, plant, and equipment (net) Accounts payable Salaries payable Paid-in capital $ 5,000 20,000 60,000 120,000 44,000 15,000 100,000
Step by Step Answer:
1 Total current assets Current liabilities 44000 15000 1000 interest payable 6...View the full answer
Related Video
The current ratio is a financial ratio that measures a company\'s ability to pay its short-term obligations with its short-term assets. It is calculated by dividing a company\'s current assets by its current liabilities. The formula for calculating the current ratio is: Current Ratio = Current Assets / Current Liabilities Current assets are assets that can be converted to cash within one year, while current liabilities are debts that are due within one year. A current ratio of 1:1 or greater is generally considered good, as it indicates that a company has enough current assets to cover its current liabilities. A current ratio of less than 1:1 may suggest that a company may have difficulty meeting its short-term obligations. It\'s important to note that the current ratio is just one of many financial ratios that can be used to assess a company\'s financial health. It should be used in conjunction with other financial ratios and qualitative factors to make informed decisions about investing or lending to a company.
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