Calculate current ratios and operation ratios for government

Assignment Help Financial Accounting

Reference no: EM133433722

Question: Obtain relevant financial information from the State of Arkansas 2017 and 2018 CAFRs, calculate current ratios and operating ratios for governmental-activities (GA), business-type activities (BA), and total primary government (TPG), and interpret the ratios. Specific questions will be provided. Obtain relevant financial information from the State of Arkansas 2017 and 2018 CAFRs, calculate current ratios and operating ratios for governmental-activities (GA), business-type activities (BA), and total primary government (TPG), and interpret the ratios. Specific questions are attached in "Assignment 2 Questions".

Table 1
(Expressed in Thousands) 2017 2018 2019
Arkansas CAFRs GA BA TPG GA BA TPG GA BA TPG
Total current assets 6319642 3201375 9521017
Total current liabilities 1674890 606158 2281048
Total Expenses 17083026 5049458 22132484
Charges for Services 1279492 3371765 4651257
Operating Grants and Contributions 7719932 811887 8531819
Total General Revenues 8203793 1082277 9286070
Assignment 2 Financial Condition Analysis

Note: All answers should be typed in this word file. Then, save and submit it to the blackboard!

1. Collect relevant financial information from the State of Arkansas CAFR 2017 and CAFR 2018 (the documents are uploaded on Blackboard), then fill the blank cells in Table 1. Each correct data collection is worth 1 point (Total 36 points).

2. Based on the question 1 answers, calculate current ratios and operation ratios for governmental activities (GA), business-type activities (BA), and total primary government activities (TPG) in 2017 and 2018, then fill the blank. Each correct calculation is worth 3 point.

Note that the ratios should be rounded up from the third decimal place (thousandth place)

3. If you submit the assignment filled with all "48 answers", you will receive 8 points for "effort".

4. Interpret the operating ratio for governmental activities (GA) in 2018. Did the government meet the balanced budget? Why do you think so? Please explain it based on the ratio result.

5. What year of the operation ratio for governmental activities (GA) represents the healthiest budgetary solvency indicator? And why? Please explain it based on the ratio results.

Reference no: EM133433722

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