Calculate the working capital and current ratio

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Reference no: EM131104717

Calculate and analyze liquidity measures Following are the current asset and current liability sections of the balance sheets for Calketch, Inc., at August 31, 2014 and 2013 (in millions):


August 31, 2014

August 31, 2013

Current Assets



Cash

$18

$36

Marketable Sec

$42

$60

AR

$78

$48

Inventories

$108

$48

Total Current Assets

$246

$192

Current Liabilities



NP

$18

$48

AP

$60

$84

Other Current Liabilities

$54

$42

Total Current liabilities

$132

$174

Required:

a. Calculate the working capital and current ratio at each balance sheet date.

Round your current ratio answers to two decimal places.

Working Capital = Current Assets less Current Liabilities.

 

August 31, 2014

August 31, 2013

CA

 

 

CL

 

 

WC

 

 

Cuurent Ratio = CA/CL

CA

 

 

CL

 

 

ratio

 

 

b. Describe the change in the firm's liquidity from 2013 to 2014.

Reference no: EM131104717

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