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The comparative financial statements for Prince Company are below: Year 2 Year 1 Income statement: Sales revenue $ 190,000 $ 167,000 Cost of goods sold
The comparative financial statements for Prince Company are below:
Year 2 | Year 1 | ||||||
Income statement: | |||||||
Sales revenue | $ | 190,000 | $ | 167,000 | |||
Cost of goods sold | 112,000 | 100,000 | |||||
Gross profit | 78,000 | 67,000 | |||||
Operating expenses and interest expense | 56,000 | 53,000 | |||||
Pretax income | 22,000 | 14,000 | |||||
Income tax | 8,000 | 4,000 | |||||
Net income | $ | 14,000 | $ | 10,000 | |||
Balance sheet: | |||||||
Cash | $ | 4,000 | $ | 7,000 | |||
Accounts receivable (net) | 14,000 | 18,000 | |||||
Inventory | 40,000 | 34,000 | |||||
Property and equipment (net) | 45,000 | 38,000 | |||||
Total assets | $ | 103,000 | $ | 97,000 | |||
Current liabilities (no interest) | $ | 16,000 | $ | 17,000 | |||
Long-term liabilities (10% interest) | 45,000 | 45,000 | |||||
Common stock ($5 par value, 6,000 shares outstanding) | 30,000 | 30,000 | |||||
Retained earnings | 12,000 | 5,000 | |||||
Total liabilities and stockholders' equity | $ | 103,000 | $ | 97,000 | |||
2. By what amount did the current ratio change? (Round your intermediate calculations and final answer to 2 decimal places.)
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