Question
Trisha's Allen Interiors Incorporated is a leading manufacturer and retailer of home furnishings in the United States and abroad. The following is adapted from Trisha's
Trisha's Allen Interiors Incorporated is a leading manufacturer and retailer of home furnishings in the United States and abroad. The following is adapted from Trisha's Allens June 30, 2019, trial balance. (The amounts shown represent millions of dollars.) Accounts Payable $ 140 Accounts Receivable 20 Cash 120 Common Stock 35 Equipment 325 Inventory 156 Notes Payable (long-term) 185 Notes Payable (short-term) 4 Prepaid Rent 37 Retained Earnings 349 Salaries and Wages Payable 30 Software 85 Assume that the following events occurred in the following quarter. Paid $20 cash for additional inventory. Issued additional shares of common stock for $15 in cash. Purchased equipment for $190; paid $90 in cash and signed a note to pay the remaining $100 in two years. Signed a short-term note to borrow $11 cash. Conducted negotiations to purchase a sawmill, which is expected to cost $42. Required: 1-a. Calculate Trisha's Allens current ratio at June 30, 2019, prior to the transactions listed above
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