(Answered) Question - the partial financial statement items below were

Accounting

Question - The partial financial statement items below were taken from the financial statements of Prone, Inc. This information can be used to correctly solve each of the ratios below. The information is in alphabetical order.

Accounts payable $ 28,000

Net income $ 48,000

Accounts receivable 66,000

Other current liabilities 17,000

Cash 54,000 Total assets 250,000

Gross profit 160,000

Total liabilities 200,000

Income before income taxes 54,000

Wages payable 5,000

Additional information: The number of average common shares outstanding during the year was 40,000.

Instructions: Compute the following:

(a) Current ratio.

(b) Working capital.

(d) Debts to total assets ratio.

To earn full credit, you must show the formula you are using, show your computations and explain the meaning of each of your ratio.

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Accounting Basics, Accounting

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