Question

Pharoah Company provides you with the following balance sheet information as of December 31, 2022.

Current assets		$10,350		Current liabilities		$10,800
Long-term assets		23,850		Long-term liabilities		12,600
Total assets		$34,200		Stockholders’ equity		10,800
				Total liabilities and stockholders’ equity		$34,200

In addition, Pharoah reported net income for 2022 of $14,400, income tax expense of $2,880, and interest expense of $1,170.

Compute the current ratio and working capital for Pharoah for 2022. (Round current ratio to 2 decimal places, e.g. 2.75. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Current ratio		enter the current ratio rounded to 2 decimal places	:1
Working capital		$enter a dollar amount

Assume that at the end of 2022, Pharoah used $2,700 cash to pay off $2,700 of accounts payable. Compute the new ratios. (Round current ratio to 2 decimal places, e.g. 2.75. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Current ratio		enter the current ratio rounded to 2 decimal places	:1
Working capital		$enter a dollar amount

Compute the debt to assets ratio and the times interest earned for Pharoah for 2022. (Round answers to 2 decimal places, e.g. 2.75. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Debt to assets ratio		enter the debt to assets ratio rounded to 2 decimal places	%
Times interest earned ratio		enter the Times interest earned ratio rounded to 2 decimal places	times

Answer 1