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I need help finding the correct acid-test ratio The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial
I need help finding the correct acid-test ratio The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial Balance January 31, 2017 Credit Debit $ 1,000 12,500 5,800 2,400 42,900 $ 15,250 10,000 5,000 27,000 2,200 Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Salaries expense Insurance expense Rent expense Store supplies expense Advertising expense Totals 111,950 2,000 2,200 38,400 0 35,000 0 15,000 0 9,800 $169,200 $169,200 Rent expense and salaries expense are equally divided between selling activities and general and administrative activities, Nelson Company uses a perpetual inventory system. Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system. Additional Information: a. Store supplies still available at fiscal year-end amount to $1,750. b. Expired insurance, an administrative expense, for the fiscal year is $1,400. c. Depreciation expense on store equipment, a selling expense, is $1,525 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,900 of inventory is still available at fiscal year-end. Problem 4-5A Part 4 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2017. (Round your answers to 2 decimal places.) Answer is complete but not entirely correct. Current ratio Acid-test ratio Gross margin ratio 1.47.1 0.38 1 0.63:1
I need help finding the correct acid-test ratio
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