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The following balance sheet data for Finn Company are shown below. a. Determine the working capital and

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The following balance sheet data for Finn Company are shown below.

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a. Determine the working capital and current ratio for 2012 and 2011.b. Does the change in the current ratio form 2011 to 2012 indicate a favorable or an unfavorabletrend?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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2012 2011 $288.000 S171,000 Current assets Current liabilities 120,000 90,000

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a 2012 2011 Current assets 288000 171000 Cu...View the full answer


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Hi, I'm Chandan Kushwaha, a mechanical engineer with a passion for teaching. I completed my Bachelor's degree in Mechanical Engineering from a reputable university, where I gained in-depth knowledge of design, analysis, and manufacturing. Throughout my career, I have gained extensive experience in the field of mechanical engineering, working on a range of projects in different industries, including automotive, aerospace, and robotics. I have a strong ability to apply my knowledge of mechanical engineering to solve complex problems and design effective solutions. In addition to my professional work, I am also a passionate tutor who enjoys helping students to develop their skills and understanding of mechanical engineering concepts. I have served as a mentor to numerous students, providing one-on-one guidance and support to help them succeed academically and professionally. My teaching style is highly interactive and focused on helping students to understand the fundamental principles of mechanical engineering. I enjoy using real-world examples and hands-on activities to make learning engaging and fun.
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Related Video

The current ratio is a financial ratio that measures a company\'s ability to pay its short-term obligations with its short-term assets. It is calculated by dividing a company\'s current assets by its current liabilities. The formula for calculating the current ratio is: Current Ratio = Current Assets / Current Liabilities Current assets are assets that can be converted to cash within one year, while current liabilities are debts that are due within one year. A current ratio of 1:1 or greater is generally considered good, as it indicates that a company has enough current assets to cover its current liabilities. A current ratio of less than 1:1 may suggest that a company may have difficulty meeting its short-term obligations. It\'s important to note that the current ratio is just one of many financial ratios that can be used to assess a company\'s financial health. It should be used in conjunction with other financial ratios and qualitative factors to make informed decisions about investing or lending to a company.

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