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The following data (in thousands) were taken from recent financial statements of Under Armour, Inc.: a. Compute

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The following data (in thousands) were taken from recent financial statements of Under Armour, Inc.:

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a. Compute the working capital and the current ratio as of December 31, 2007 and 2006. Round to two decimal places.b. What conclusions concerning the company's ability to meet its financial obligations can you draw from part(a)?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
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December 31 2006 2007 $322,245 Current assets Current liabilities $244,952 71,563 95,699

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a Working capital 2006 173389 24495271563 2007 226546 32224595699 Current Ratio 200...View the full answer


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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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