The right answer for the question above is: b. <span>debit to Supplies for $585.</span>
Answer:
Current ratio = 2.25
Acid test ratio = 1.25
After Taking Loan
Current ratio = 1.64
Acid test ratio = 0.91
Explanation:
Current Ratio is the comparison of company's short term assets and short term liabilities to see if the company is able to pay its short term liabilities.
Current Ratio = Current Assets / Current Liabilities = $90,000 / $40,000 = 2.25 times
The company can pay 2.25 time the current liabilities from its current assets.
Asset test ratio compares company's most short term assets with most short term liabilities to check that if company is able to pay all the immediate liabilities it become due.
Acid Test ratio = ( 90,000 - 40,000 ) / 40,000 = 1.25
After taking the bank loan
Total current Liabilities = $15,000 + 40,000 = $55,000
Current ratio= $90,000 / $55000 = 1.64
Acid test ratio = $50,000 / $55000 = 0.91
Answer:
a the purches of TWA by american airlines
Answer:
B) $43,400
Explanation:
The computation of the net income is shown below:
Revenue $100,000
Less: Cost of goods sold $10,000
Gross profit $90,000
Less: Selling General & Administrative Expenses $20,000
Less: Research and Development Expense$5,000
Less: Depreciation and Amortization Expense $3,000
Operating income $62,000
Less: Income tax provision -$18,600
Net income $43,400
