### Computation of current ratio and working capital

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##### Reference no: EM1315909

Computation of Current ratio, Working capital, Acid-test ratio, Receivables turnover and Inventory turnover.

Boyle Corporation had the following comparative current assets and current liabilities:

 Dec. 31, 2002 Dec. 31, 2001 Current assets Cash \$60,000 \$30,000 Marketable securities 40,000 10,000 Accounts receivable 55,000 95,000 Inventory 110,000 90,000 Prepaid expenses 35,000 20,000 Total current assets \$300,000 \$245,000 Current liabilities Accounts payable \$140,000 \$110,000 Salaries payable 40,000 30,000 Income tax payable 20,000 15,000 Total current liabilities \$200,000 \$155,000

During 2002, credit sales and cost of goods sold were \$750,000 and \$400,000, respectively.

INSTRUCTIONS
Compute the following liquidity measures for 2002:

1. Current ratio.
2. Working capital.
3. Acid-test ratio.
4. Receivables turnover.
5. Inventory turnover.

##### Reference no: EM1315909

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