Solution-Compute the amount of working capital

Compute the amount of working capital

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Reference no: EM13535056

The following data are for Clock Company: Allowance for uncollectible accounts

	December 31
	2011	2010
Notes payable (due in 90 days)	$75,200	$60,000
Merchandise inventory	240,000	208,000
Cash	100,000	128,000
Marketable securities	49,600	30,000
Accrued liabilities	19,200	22,000
Accounts receivable	188,000	1,84,000
Accounts payable	112,000	72,000
Allowance for uncollectible accounts	24,000	15,200
Bonds payable, due 2008	156,000	1,60,000
Prepaid expenses	6,400	7,360
Cash flow from operating activities	60,000	40,000

a. Compute the amount of working capital at both year-end dates.

b. Compute the current ratio at both year-end dates.

c. Compute the acid-test ratio at both year-end dates.

d. Compute the cash flow liquidity ratio at both year-end dates.

e. Comment briefly on the company"s short-term financial position.

Reference no: EM13535056

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Compute the amount of working capital

Reference no: EM13535056

Reference no: EM13535056

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