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18 September, 10:46

has the following current assets: cash, $1,200; receivables, $1,500; inventory, $2,000 and other current assets, $1,300. Airline Accessories has the following liabilities: accounts payable, $1,000 million; current portion of long-term debt, $3,000; and long-term debt, $1,800. Based on these amounts, calculate the current ratio and working capital

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  1. 18 September, 11:01
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    Current Ratio = 1.5

    Working Capital = $2,000 million

    Explanation:

    Current Ratio = Current Assets / Current Liabilities

    = ($1,200 + $1,500 + $2,000 + $1,300) / ($1,000 + $3,000)

    = $6,000 / $4,000

    = 1.5

    Working Capital = Current Assets - Current Liabilities

    = $6,000 million - $4,000 million

    = $2,000 million
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