PA$2-3($Static$)$ Recording Transactions $($in a Journal and T$-$Accounts$)$; Preparing and Interpreting the

Balance Sheet $[$LO $2-1,$ LO $2-2,$ LO $2-3,$ LO $2-4,$ LO $2-5]$

$[$The following information applies to the questions displayed below.$]$

Ethan Allen Interiors Incorporated is a leading manufacturer and retailer of home furnishings in the United States and

abroad. The following is adapted from Ethan Allen's June $30,2019,$ trial balance. $($The amounts shown represent millions of

dollars.$)$

Assume that the following events occurred in the following quarter.

a$.$ Paid $$10$ cash for additional inventory.

b$.$ Issued additional shares of common stock for $$20$ in cash.

c$.$ Purchased equipment for $$170$; paid $$15$ in cash and signed a note to pay the remaining $$155$ in two years.

d$.$ Signed a short$-$term note to borrow $$10$ cash.

e$.$ Conducted negotiations to purchase a sawmill, which is expected to cost $$36.$

PA$2-3($Static$)$ Part $1$

Required:

$1-$a$.$ Calculate Ethan Allen's current ratio at June $30,2019,$ prior to the transactions listed above. $($Round your answer to $2$ decimal

places.$)$