Solution-Calculate the working capital and current ratio

Calculate the working capital and current ratio

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Reference no: EM131104717

Calculate and analyze liquidity measures Following are the current asset and current liability sections of the balance sheets for Calketch, Inc., at August 31, 2014 and 2013 (in millions):

	August 31, 2014	August 31, 2013
Current Assets
Cash	$18	$36
Marketable Sec	$42	$60
AR	$78	$48
Inventories	$108	$48
Total Current Assets	$246	$192
Current Liabilities
NP	$18	$48
AP	$60	$84
Other Current Liabilities	$54	$42
Total Current liabilities	$132	$174

Required:

a. Calculate the working capital and current ratio at each balance sheet date.

Round your current ratio answers to two decimal places.

Working Capital = Current Assets less Current Liabilities.

	August 31, 2014	August 31, 2013
CA
CL
WC
Cuurent Ratio = CA/CL
CA
CL
ratio

b. Describe the change in the firm's liquidity from 2013 to 2014.

Reference no: EM131104717

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Calculate the working capital and current ratio

Reference no: EM131104717

Reference no: EM131104717

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