Question

Exercise 3-19 Calculating ratios; solve for unknowns [LO3-8) The current asset section of Guardian Consultant's balance sheet consists of cash, accounts receivable, and prepaid expenses. The 2018 balance sheet reported the following: cash, $1,410,000, prepaid expenses, $470,000; noncurrent assets, $3,500,000; and shareholders' equity, $3,600,000. The current ratio at the end of the year was 2.0 and the debt to equity ratio was 1.5 Required: Determine the following 2018 amounts and ratios: (Round your "The acid-test ratio answer to 1 decimal place.) Answer is complete but not entirely correct. 1. Current liabilities 2,750,000 Long-term Accounts The acid-test 2. liabiities 2.650.000 C 3. receivable 3,620,000 28 0 ratio

Answer 1

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Cash	$1,410,000
Prepaid Expense	$   470,000
Accounts Receivable	$3,620,000
Non Curerent Assets	$3,500,000
Shareholder Equity	$3,600,000
Current Liabilities	$2,750,000
Long Term Liabilities	$2,650,000
Acid Test Ratio	1.83
(Cash + Accounts Receivable/Current Liabilities)
(1410000+3620000)/2750000