Balance Sheet December 31, Year 2 and Year 1 (in thousands of dollars) Assets Year 2 Year 1 Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net $ 178 $ 138 265 285 138 148 49 49 630 620 790 790 Total assets $ 1,420 $ 1,410 Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities $ 148 $ 168 99 99 Notes payable, short term Total current liabilities Bonds payable Total liabilities Stockholders' equity: Common stock, $2 par value Additional paid-in capital 69 79 316 346 307 317 623 663 118 118 245 245 Retained earnings 434 384 Total stockholders' equity 797 747 Total liabilities & stockholders' equity $ 1,420 $ 1,410 Income Statement For the Year Ended December 31, Year 2 (in thousands of dollars) Sales (all on account) Cost of goods sold $ 1,670 960 710 404 306 53 253 76 $ 177 Gross margin Selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes (30%) Net income The current ratio at the end of Year 2 is closest to: