Question
Quick Ratio Gmeiner Co. had the following current assets and liabilities on December 31 of two recent years: Current Year Previous Year Current assets: Cash
Quick Ratio
Gmeiner Co. had the following current assets and liabilities on December 31 of two recent years:
Current Year | Previous Year | ||||||
Current assets: | |||||||
Cash | $ 486,000 | $ 500,000 | |||||
Accounts receivable | 210,000 | 200,000 | |||||
Inventory | 375,000 | 350,000 | |||||
Total current assets | $1,071,000 | $1,050,000 | |||||
Current liabilities: | |||||||
Current portion of long-term debt | $ 145,000 | $ 110,000 | |||||
Accounts payable | 175,000 | 150,000 | |||||
Accrued and other current liabilities | 260,000 | 240,000 | |||||
Total current liabilities | $ 580,000 | $ 500,000 |
a. Determine the quick ratio for December 31 of both years. If required, round your answers to one decimal place.
Quick Ratio | |
Previous year: need answer | |
Current year: need answer |
b. How did the quick ratio change between the two balance sheet dates? increase/decrease
Which statement below describes the change between the two balance sheet dates?
both quick assets and current liabilities declined
both quick assets and current liabilities increased
quick assets increased and current liabilites declines
quick assets declines and current liabilites increased
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