eBook Show Me How Working Capital and Current Ratio The following data (in thousands) were taken from recent financial statements of Under Armour, Inc.: December 31 Current assets Current liabilities Year 2 $ 152,582 Year 1 50,027 $ 110,320 37,020 a. Compute the working capital and the current ratio as of December 31, Year 2 and Year 1. Enter working capital amounts in thousands of dollars. Round "current ratio" answers to two decimal places. December 31 Year 2 Year 1 Working capital 47,555 X 73,300 < Current ratio 3.05 2.98 b. What conclusions concerning the company's ability to meet its financial obligations can you draw from part (a)? Under Armour's working capital decreased receiving payment from Under Armour. X by $25,745 x during Year 2. The current ratio increased in Year 2. Because Year 2's current ratio indicates a weak x liquidity position, the short-term creditors should be X concerned about Feedback Check My Work Remember that current assets are compared to current liabilities to see if current obligations can be paid off with current resources. This is expressed by a dollar amount and a ratio.