Effect of Transactions on Working Capital, Current Ratio, and
Quick Ratio
The following account balances are taken from the records of
Liquiform Inc.:
Cash
$ 70,000
Short-term investments
60,000
Accounts receivable
80,000
Inventory
100,000
Prepaid insurance
10,000
Accounts payable
75,000
Taxes payable
25,000
Salaries and wages payable
40,000
Short-term loans payable
60,000
Required:
1. Use the information provided to compute the
amount of working capital and Liquiform's current and quick ratios
(round to two decimal points).
Working capital
$
Current...