Current assets and current liabilities for Brimstone Company follow:      20Y4    20Y3   Current assets   $1,529,000   $1,128,750   Current liabilities   695,000   525,000   a. Determine the working capital and current ratio for 20Y4 and 20Y3. Round Current ratio to 2 decimal places.      20Y4    20Y3   Working capital   $   $   Current ratio           b. Does the change in the current ratio from 20Y3 to 20Y4 indicate a favorable or an unfavorable change?

Corporate Financial Accounting
15th Edition
ISBN:9781337398169
Author:Carl Warren, Jeff Jones
Publisher:Carl Warren, Jeff Jones
Chapter14: Financial Statement Analysis
Section: Chapter Questions
Problem 14.6EX: a. (1) Current year working capital. 1,090,000 Current position analysis The following data were...
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Working capital and current ratio

Current assets and current liabilities for Brimstone Company follow:

     20Y4    20Y3  
Current assets   $1,529,000   $1,128,750  
Current liabilities   695,000   525,000  

a. Determine the working capital and current ratio for 20Y4 and 20Y3. Round Current ratio to 2 decimal places.

     20Y4    20Y3  
Working capital   $   $  
Current ratio          

b. Does the change in the current ratio from 20Y3 to 20Y4 indicate a favorable or an unfavorable change?

 

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