Reference no: EM132483217
The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. Nelson company uses a perpetual inventory system. It categorizes the following accounts as selling expenses: Depreciation Expense-Store Equipment, Sales Salaries Expense, Rent Expense-Selling Space, Store Supplies Expense, and Advertising Expense. It categorizes the remaining expenses as general and administrative.
NELSON COMPANY
Unadjusted Trial Balance
January 31 Debit Credit
Cash $29,100
Merchandise inventory 12,500
Store supplies 5,200
Prepaid insurance 2,600
Store equipment 42,700
Accumulated depreciation-Store equipment $17,950
Accounts payable 14,000
Common stock 5,000
Retained earnings 34,000
Dividends 2,150
Sales 116,000
Sales discounts 1,900
Sales returns and allowances 2,200
Cost of goods sold 38,000
Depreciation expense-Store equipment 0
Sales salaries expense 13,450
Office salaries expense 13,450
Insurance expense 0
Rent expense-Selling space 7,000
Rent expense-Office space 7,000
Store supplies expense 0
Advertising expense 9,700
Totals$186,950 $186,950
Additional Information:
- Store supplies still available at fiscal year-end amount to $2,800.
- Expired insurance, an administrative expense, is $1,500 for the fiscal year.
- Depreciation expense on store equipment, a selling expense, is $1,625 for the fiscal year.
- To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,600 of inventory is still available at fiscal year-end.
Question 1: Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31. (Round your answers to 2 decimal places.)