Question

Nordstrom, Inc. operates department stores in numerous states. Suppose selected financial statement data (in millions of dollars) for a recent year follow. End of Year Beginning of Year Cash and cash equivalents $     80 $    390 Receivables (net) 1,960 1,950 Merchandise inventory 625 886 Other current assets 375 300 Total current assets $3,040 $3,526 Total current liabilities $1,520 $1,720

Compute working capital and the current ratio at the beginning of the year and at the end of the year. (Round current ratio to 2 decimal places, e.g. 15.25.) Beginning of Year End of Year Working capital $ enter a dollar amount $ enter a dollar amount Current ratio enter current ratio rounded to 2 decimal places :1 enter current ratio rounded to 2 decimal places :1

Answer 1

solution Beginning of year: working capital assets - Total current leabilities = = Total current 3526 – 1720 = 1806 Current Ratio Current leathletler = = = Total Current Assets / Total 3526 / 1720 2:05: 1

End of year: working capital = Total Current Assets - Total current abilities = 3040 – 1520 = 1520 Current Ratio = = = Total corrent Assets / Total Current leabilities 3040 / 1520 2:1