SDJ, Inc., has net working capital of $1,960, current liabilities of $5,590, and inventory of $1,260....

SDJ, Inc., has net working capital of $1,960, current liabilities of $5,590, and inventory of $1,260.

A. what is the current ratio?

B. what is the quick ratio?

Solutions

Expert Solution

Current assets= Net Working capital + Current Liabilities

Current Ratio= Current Assets/Current Liabilities

Quick Ratio= (Current assets-Inventory)/ Current Liabilities

Given,

Net Working capital = $1,960

Current Liabilities = $5,590

Inventory= $1,260

Plugging the values,

Current Ratio= ($1,960 + $5,590)/$5,590 = 1.350626

Quick Ratio= ($1,960 + $5,590-$1,260)/$5,590 = 1.1252236

jeff jeffy answered 2 years ago

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