2. The following data are taken from the sheet at the end of the current year:

Cash 633,000

Short-term Investments 325,000

Notes Payable, long-term 225,000

Prepaid Insurance 80,000

Accounts Payable 999,000

Accrued Liabilities 525,000

Inventory 1,425,000

Accounts Receivable 108,000

Salaries Payable 125,000

Intangible Assets 625,000

Property, Plant and Equipment 1,700,000

Computation Interpretationwhat does the result mean?

Compute: a. Working capital: ___________________ __________________________________

b. Current ratio: ___________________ __________________________________

c. Quick ratio: ___________________ __________________________________

d. Consider the additional information. Compare results and interpret your findings: Are the results acceptable? Explain.

1. Current ratio, prior year: 1.5

2. Industry average: 1.1