Question

Using the following balance sheet and income statement data, what is the current ratio? Current assets...

Using the following balance sheet and income statement data, what is the current ratio?

Current assets

 $20400

Net income

 $42900

Current liabilities

 9800

Stockholders' equity

 66800

Average assets

 138000

Total liabilities

 29000

Total assets

 90600


Average common shares outstanding was 17000.

0.70 : 1

3.12 : 1

0.63 : 1

2.08 : 1

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Homework Answers

Answer #1

The formula to find the Current Ratio for the current year is as follows:-

Current Ratio = Current Assets/Current Liabilities

Current Ratio = $20,400/$9,800

Current Ratio = 2.08 times

Based on the above calculation, the correct answer is Option D - 2.08 :1

Option A, Option B and Option C are all incorrect as they represent different values than the actual correct ratio presented above.

Please let me know if you have any questions via comments and all the best :)

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