Required information The Foundational 15 (Algo) [LO14-2, LO14-3, LO14-4, LO14-5, LO14-6] Skip to question ...

70.2K

Verified Solution

Question

Accounting

Required information

The Foundational 15 (Algo) [LO14-2, LO14-3, LO14-4, LO14-5, LO14-6]

Skip to question

[The following information applies to the questions displayed below.]

Markus Companys common stock sold for $1.50 per share at the end of this year. The company paid a common stock dividend of $0.39 per share this year. It also provided the following data excerpts from this years financial statements:

	Ending Balance	Beginning Balance
Cash	$ 24,500	$ 40,800
Accounts receivable	$ 42,000	$ 38,800
Inventory	$ 42,400	$ 42,000
Current assets	$ 108,900	$ 121,600
Total assets	$ 302,000	$ 242,800
Current liabilities	$ 46,500	$ 31,500
Total liabilities	$ 92,000	$ 82,800
Common stock, $1 par value	$ 107,000	$ 107,000
Total stockholders equity	$ 210,000	$ 160,000
Total liabilities and stockholders equity	$ 302,000	$ 242,800

	This Year
Sales (all on account)	$ 480,000
Cost of goods sold	$ 278,400
Gross margin	$ 201,600
Net operating income	$ 32,500
Interest expense	$ 2,000
Net income	$ 21,350

Foundational 14-8 (Algo)

8. What is the acid-test ratio at the end of this year? (Round your answer to 2 decimal places.)

Answer & Explanation Solved by verified expert

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member