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7-13 Wolfe Hospitality Consulting had the following transactions occur involving current assets and current liabilities...

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Accounting

7-13 Wolfe Hospitality Consulting had the following transactions occur involving current assets and current liabilities during February 2008:
Feb. 3 Accounts receivable of $15,000 are collected.
7 Equipment is purchased for $28,000 cash.
11 Paid $3,000 for a three-year insurance policy.
14 Accounts payable of $12,000 are paid.
18 Cash dividends of $5,000 are declared.
Additional information:
As of February 1,2008, current assets were $140,000, and current liabilities were $50,000.
As of February 1,2008, current assets included $15,000 of inventory and $2,000 of prepaid expenses.
Instructions
(a) Compute the current ratio as of the beginning of the month and after each transaction.
(b) Compute the acid-test ratio as of the beginning of the month and after each transaction.
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