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Please refer to Table 4-1 for the following questions. Table 4-1 Stewart Company Balance Sheet Assets: Cash and marketable securities Inventories Prepaid expenses Total current
Please refer to Table 4-1 for the following questions. Table 4-1 Stewart Company Balance Sheet Assets: Cash and marketable securities Inventories Prepaid expenses Total current assets $800,000 900,000 1,500,000 75,000 $3,075.000 Total current assets Fixed assets 53,075,000 8,000,000 Less: sooum. depr 2.075,000) Net fixed assets Total assets $5 925.000 $9,000,000 Liabilities: Accounts psyable Notes payable Accrued taxes Total current liabilities Long-term debt Owner's eouity (1 million shares of common $800,000 700,000 50,000 $1,550,000 2,500,000 4.950.000 Long-term deb Owner's equity (1 million shares of common stock outstanding) Total liabilities and owner's equity 2,500,0OD 4,950,000 $9.000,000 Net sales (all credit) Less: Cost of goods sold Selling and administrative expense Depreciation expense Interest expense Earnings before taxes Income taxes Net income $10,000,000 (3,000,000) (2,000,000) (250,000) (200,000) 4,550,000 (1,820,000) $2,730,000 Net income $2,730,000 Based on the information in Table 4-1, the current ratio is OA. 2.86. OB. 1.98. O C. 2.88. O D. 1.92
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