Following is financial statement information for Rogex Corporation: cash = $242; accounts receivable = $850; inventory = $820; net fixed assets = $3,408; accounts payable = $700; short-term notes payable = $740; long-term liabilities = $1,100; common stock = $1,160; and retained earnings = $1,620.What is the current ratio for Rogex?
A)1.46
B)1.33
C)1.23
D)1.21

Question

Quizplus · Accepted Answer

The current ratio is calculated as Current Assets / Current Liabilities. Current Assets = Cash + Accounts Receivable + Inventory = $242 + $850 + $820 = $1,912. Current Liabilities = Accounts Payable + Short-term Notes Payable = $700 + $740 = $1,440. Therefore, the current ratio = $1,912 / $1,440 = 1.33.

Following Is Financial Statement Information for Rogex Corporation: Cash =