Question

Excerpts from Candle Corporation's most recent balance sheet (in thousands of dollars) appear below:

       

	Year 2		Year 1
Current assets:
Cash	$	200	$	140
Accounts receivable		200		210
Inventory		120		160
Prepaid expenses		54		64
Total current assets	$	574	$	574
Current liabilities:
Accounts payable	$	130	$	130
Accrued liabilities		80		84
Notes payable, short term		64		54
Total current liabilities	$	274	$	268

   

Sales on account during the year totaled $1,400 thousand. Cost of goods sold was $870 thousand.

Required:
a.	Compute the following working capital for Year 2.(Enter your answer in thousands of dollars, i.e., 100,000 should be entered as 100.)

      

b.	Compute the following current ratio for Year 2. (Round your answer to 2 decimal places.)

    
      

c.	Compute the following acid-test ratio for Year 2. (Round your answer to 2 decimal places.)

   

      

d.	Compute the following accounts receivable turnover for Year 2.(Round your answer to 2 decimal places.)

  

Answer 1