Current Ratio

Gungor Inc. reported the following current accounts at the end of two recent years:

	December 31, 2017		December 31, 2016
Cash	$3,350		$6,700
Accounts receivable	15,000		10,000
Inventory	12,000		8,000
Accounts payable	12,000		7,000
Wages payable	2,000		1,000
Notes payable	6,000		4,000

Required:

1. The current ratio for December 31, 2017 and for December 31, 2016, respectively are:

2. Gungor's liquidity has at the end of 2017 compared to the end of 2016 due to increasing by the in current liabilities.

3. The change in composition of the company's current assets at the end of 2017 compared to the end of 2016 reflects cash and accounts receivable and inventory.