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				$391,000			$300,000
Marketable securities				515,000			354,000
Accounts and notes receivable (net)				634,000			426,000
Inventories				368,000			222,000
Prepaid expenses				182,000			138,000
	Total current assets			$2,090,000			$1,440,000
Current liabilities:
Accounts and notes payable (short-term)				$725,000			$600,000
Accrued liabilities				275,000			300,000
	Total current liabilities			$1,000,000			$900,000

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	$fill in the blank 1			$fill in the blank 2
2. Current ratio	fill in the blank 3			fill in the blank 4
3. Quick ratio	fill in the blank 5			fill in the blank 6

b. The liquidity of Nilo has improved from the preceding year to the current year. The working capital, current ratio, and quick ratio have all increased . Most of these changes are the result of an increase in current assets relative to current liabilities.