What is the current ratio

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Reference no: EM13143842

Show all computations for each problem.

1. The current ratio of a company is 4 and its quick ratio is 1. If the inventory amount to $450,000, what is the amount of current liabilities?

2. A company has current assets of $80,000 (of which $30,000 is inventory) and current liabilities of $20,000.

a. What is the current ratio?

b. What is the quick ratio?

c. If the company borrows $10,000 cash for a bank on a 120-day loan, what will its current ratio be? What will the quick ratio be?

3. Franklin Bedding, Inc. has assets of $400,000 and turns over its assets 1.5 times per year. Return on assets is 12 percent. What is its profit margin (return on sales)?

Reference no: EM13143842

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