Working capital and current ratio

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Working Capital and Current Ratio

The balance sheet of Kapinski Inc. includes the following items:

Cash

$23,000

Accounts payable

$  84,900

Accounts receivable

43,000

Salaries payable

3,200

Inventory

75,000

Capital stock

100,000

Prepaid insurance

2,800

Retained earnings

35,700

Land

80,000

 

 

Required

 

 

 

1. Determine the current ratio and working capital.

2. Kapinski appears to have a positive current ratio and a large net working capital. Why would it have trouble paying bills as they come due?

3. Suggest three things that Kapinski can do to help pay its bills on time.

Reference no: EM13953324

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