Question

The Pioneer Company has provided the following account balances: Cash $39,400; Short-term investments $5,400; Accounts receivable $7,400; Supplies $55,000; Long-term notes receivable $3,400; Equipment $103,000; Factory Building $194,000; Intangible assets $7,400; Accounts payable $28,600; Accrued liabilities payable $3,300; Short-term notes payable $16,800; Long-term notes payable $99,000; Common stock $194,000; Retained earnings $73,300. What is Pioneer's current ratio

Answer 1

Answer:

2.20

Explanation:

Calculation for What is Pioneer's current ratio

First step is to calculate current assets

Current assets = $39,400 + $5,400 + $7,400 + $55,000

Current assets = $107,200

Second step is to calculate Current liabilities

Current liabilities =

=$28,600 + $3,300 + $16,800.

Current liabilities =$48,700

Now let calculate Current ratio

Using this formula

Current ratio=Current assets/Current Liabilities

Let plug in the formula

Current ratio = $107,200 ÷ $48,700.

Current ratio=2.20

Therefore Pioneer's current ratio will be 2.20