Brock Company's financial information is listed below.Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Assets
Liabilities and Stockholders' Equity

Income Statement

What is the current ratio?

Question

Brock Company's financial information is listed below.Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Assets
 Liabilities and Stockholders' Equity
​
 Income Statement
 ​
 What is the current ratio?

Quizplus · Accepted Answer

Current Ratio = Current Assets / Current Liabilities
Current Assets = Cash + Accounts Receivable + Inventory = $25,000 + $45,000 + $60,000 = $130,000
Current Liabilities = Accounts Payable + Accrued Expenses = $40,000 + $20,000 = $60,000
Current Ratio = $130,000 / $60,000 = 1.58

Brock Company's Financial Information Is Listed Below