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Halifax Fisheries Inc. began the month of March with $760,000 of current assets, a current ratio of 2.5 to 1, and a quick ratio of
Halifax Fisheries Inc. began the month of March with $760,000 of current assets, a current ratio of 2.5 to 1, and a quick ratio of 1.1 to 1. During the month, it completed the following transactions:
Mar. | 6 | Bought $86,000 of merchandise on account. (The company uses a perpetual inventory system.) | ||
11 | Sold merchandise that cost $70,000 for $118,000. | |||
15 | Collected a $30,000 account receivable. | |||
17 | Paid a $32,000 account payable. | |||
19 | Wrote off a $14,000 bad debt against Allowance for Doubtful Accounts. | |||
24 | Declared a $1.75 per share cash dividend on the 41,000 outstanding common shares. | |||
28 | Paid the dividend declared on March 24. | |||
29 | Borrowed $90,000 by giving the bank a 30-day, 19% note. | |||
30 | Borrowed $110,000 by signing a long-term secured note. | |||
31 | Used the $200,000 proceeds of the notes to buy additional machinery. |
Required: Prepare a schedule showing Halifax Fisheries Inc.s current ratio, quick ratio, and working capital after each of the transactions. (Round ratios to 2 decimal places and other final answers to nearest whole dollar.)
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