Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $56,900; total assets, $219,400; common stock, $88,000; and retained earnings, $26,363.) Assets Cash Short-term investments. Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets CABOT CORPORATION Balance Sheet December 31 of current year Liabilities and Equity $ 12,000 Accounts payable 9,200 Accrued wages payable 29,400 Income taxes payable 32,150 Long-term note payable, secured by mortgage on plant assets 2,950 Common stock 153,300 Retained earnings $239,000 Total Liabilities and equity CABOT CORPORATION Incone Statement For Current Year Ended December 31, Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income tax expense Net income $ 448,600 297,550 151,050 99,300 4,800 46,950 18,913 $28,037 $ 17,500 3,200 4,500 71,400 88,000 54,400 $ 239,000 Compute the current ratio and acid-test ratio. (1) ces (2) Current Ratio Numerator: Denominator: Current assets Current liabilities Acid-Test Ratio Numerator: Denominator: Current Ratio = Current ratio = 0 to 1 Ring 1 and 2 Req 3 > Acid-Test Ratio Acid-Test Ratio 0 to 1