The December 31, Year 1, balance sheet of Rowan Company shows current assets of $32,000 and current liabilities of $20,000. On January 1, Year 2, the company had the following two transactions: 1)Issued common stock for $10,000 cash
2)Received a $6,000 cash payment for its accounts receivable
After the two transactions are recorded, what is the company's current ratio?
A)2 to 1
B)1.6 to 1
C)2.4 to 1
D)2.1 to 1

Question

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The Answer of The December 31, Year 1, balance sheet of Rowan Company shows current assets of $32,000 and current liabilities of $20,000. On January 1, Year 2, the company had the following two transactions: 1)Issued common stock for $10,000 cash
2)Received a $6,000 cash payment for its accounts receivable
After the two transactions are recorded, what is the company's current ratio?
A)2 to 1
B)1.6 to 1
C)2.4 to 1
D)2.1 to 1

The December 31, Year 1, Balance Sheet of Rowan Company