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Use the information in the following adjusted trial balance for the Wilson Trucking Company. Account Title...

Use the information in the following adjusted trial balance for the Wilson Trucking Company. Account Title Debit Credit Cash $ 8,100 Accounts receivable 16,500 Office supplies 2,000 Trucks 183,000 Accumulated depreciation—Trucks $ 37,698 Land 75,000 Accounts payable 12,100 Interest payable 3,000 Long-term notes payable 52,000 K. Wilson, Capital 175,147 K. Wilson, Withdrawals 19,000 Trucking fees earned 123,000 Depreciation expense—Trucks 24,315 Salaries expense 57,687 Office supplies expense 6,765 Repairs expense—Trucks 10,578 Totals $ 402,945 $ 402,945 1. Calculate the current ratio. Assume that the industry average for the current ratio is 1.5.

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Answer #1

Formula for Current Ratio

Current Ratio = Current Assets / Current Liabilities

Current Assets = Cash + Accounts Receivables + Office Supplies

Current Assets = 8,100 + 16,500 + 2,000

Current Assets = $ 26,600

Current Liabilities = Accounts Payables + Interest Payable

Current Liabilities = 12,100 + 3,000

Current Liabilities = $ 15,100

Current Ratio = 26,600 / 15,100

Current Ratio = 1.7615 Times

Current Ratio = 1.7615:1

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