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Current Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year
Current Position Analysis
The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years:
Current Year | Previous Year | |||||||
Current assets: | ||||||||
Cash | $593,600 | $496,000 | ||||||
Marketable securities | 687,300 | 558,000 | ||||||
Accounts and notes receivable (net) | 281,100 | 186,000 | ||||||
Inventories | 796,600 | 567,300 | ||||||
Prepaid expenses | 410,400 | 362,700 | ||||||
Total current assets | $2,769,000 | $2,170,000 | ||||||
Current liabilities: | ||||||||
Accounts and notes payable | ||||||||
(short-term) | $411,800 | $434,000 | ||||||
Accrued liabilities | 298,200 | 186,000 | ||||||
Total current liabilities | $710,000 | $620,000 |
a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place.
Current Year | Previous Year | |||||
1. Working capital | $ | $ | ||||
2. Current ratio | ||||||
3. Quick ratio |
b. The liquidity of Nilo has from the preceding year to the current year. The working capital, current ratio, and quick ratio have all . Most of these changes are the result of an in current assets relative to current liabilities.
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