Denna Company’s working capital accounts at the beginning of the year follow: In
ID: 2491183 • Letter: D
Question
Denna Company’s working capital accounts at the beginning of the year follow:
Indicate the effect of each of the transactions given above on working capital, the current ratio, and the acid-test ratio. Give the effect in terms of increase, decrease, or none. Item (x) is given as an example: Consider each transaction independently and indicate their effects as compared to the ratios and amounts at the beginning of the period.
Denna Company’s working capital accounts at the beginning of the year follow:
Explanation / Answer
1.
Working:
2.
Working capital = $ 562,900 Current Ratio = 2.45 Acid-test ratio = 1.19