Homework Answers
Current ratio = Current assets / Current liabilities
= (Cash + Supplies + Accounts receivable) / (Accounts payable + Unearned service revenue)
= ($5,000 + $3,000 + $12,000) / ($2,000 + $3,000)
= $20,000 / $5,000
= 4 times
The answer is Option c.
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