Reference no: EM131818010

Question - Keener Incorporated had the following transactions occur involving current assets and current liabilities during February 2017.

Feb. 3 Accounts receivable of $14,400 are collected.

Feb. 7 Equipment is purchased for $27,200 cash.

Feb. 11 Paid $2,700 for a 1-year insurance policy.

Feb. 14 Accounts payable of $11,400 are paid.

Feb. 18 Cash dividends of 55,300 are declared.

Additional information:

1. As of February 1, 2017, current assets were $132,200, and current liabilities were $49,600.

2. As of February 1, 2017, current assets included $15,200 of inventory and $1,400 of prepaid expenses.

(a) Compute the current ratio as of the beginning of the month and after each transaction.

(b) Compute the acid-test ratio as of the beginning of the month and after each transaction.