LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2017 and 2018 Gross sales Sales returns and allowances Net sales Cost of merchandise (goods) sold Gross profit Operating expenses: Depreciation Selling and administrative Research Miscellaneous Total operating expenses Income before interest and taxes Interest expense Income before taxes Provision for taxes Net income 2018 $21,600 900 2017 $16,950 100 $20,700 11,350 $16,850 8,300 $ 9,350 $8,550 $ 960 4,150 810 $ 730 3,300 630 620 430 $ 6,540 $ 5,090 $ 2,810 $ 3,460 820 630 $ 1,990 $ 2,830 796 1,132 $ 1,194 $1,698 LOGIC COMPANY Comparative Balance Sheet December 31, 2017 and 2018 Assets 2018 2017 Current assets: Cash Accounts receivable Merchandise inventory Prepaid expenses Total current assets Plant and equipment: Building (net) Land Total plant and equipment Total assets $13,300 $10,300 17,800 13,800 9,800 15,300 25,300 11,300 $66,200 $50,700 $15,800 $12,300 14,800 10,300 $30,600 $22,600 $96,800 $73,300 12 LOGIC COMPANY Comparative Balance Sheet December 31, 2017 and 2018 Assets 2018 2017 Current assets: Cash Accounts receivable Merchandise inventory Prepaid expenses Total current assets Plant and equipment: Building (net) Land Total plant and equipment Total assets Current liabilities: $13,300 $10,300 17,800 13,800 9,800 15,300 25,300 11,300 $66,200 $50,700 $15,800 $12,300 14,800 10,300 $30,600 $22,600 $96,800 $73,300 Liabilities Accounts payable Salaries payable Total current liabilities $14,300 $ 8,200 8,200 $22,500 $14,500 6,300 Long-term liabilities: Mortgage note payable. 23,300 21,800 Total liabilities $45,800 $36,300 Stockholders' Equity Common stock $22,300 $22,200 Retained earnings 28,700 14,800 Total stockholders' equity $51,000 $37,000 Total liabilities and stockholders' equity $96,800 $73,300 Calculate the acid test ratio. (Round your answers to the nearest hundredth.) 2018 Acid test ratio 2017