Reference no: EM13897127

Plum Corporation began the month of May with $ 700,000 of current assets, a current ratio of 2.50:1, and an acid test ratio of 1.10:1. During the month, it completed the following transactions (the company uses a perpetual inventory system). 

May 2 Purchased $ 50,000 of merchandise inventory on credit. 
8 Sold merchandise inventory that cost $ 55,000 for $ 110,000 cash. 10 Collected $ 20,000 cash on an account receivable. 
15 Paid $ 22,000 cash to settle an account payable.
17 Wrote off a $ 5,000 bad debt against the Allowance for Doubtful Accounts account. 
22 Declared a $1 per share cash dividend on its 50,000 shares of outstanding common stock. 
26 Paid the dividend declared on May 22. 27 Borrowed $ 100,000 cash by giving the bank a 30 day, 10% note. 
28 Borrowed $ 80,000 cash by signing a long term secured note. 
29 Used the $ 180,000 cash proceeds from the notes to buy new machinery. 

Required 

Prepare a table showing Plum's 
(1) Current ratio, 
(2) Acid test ratio, 
(3) Working capital, after each transaction. Round ratios to two decimals.