Question

The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company.

NELSON COMPANY Unadjusted Trial Balance January 31, 2017
	Debit			Credit
Cash	$	46,550
Merchandise inventory		13,000
Store supplies		5,500
Prepaid insurance		2,800
Store equipment		42,600
Accumulated depreciation—Store equipment				$	19,800
Accounts payable					16,000
J. Nelson, Capital					18,000
J. Nelson, Withdrawals		2,250
Sales					153,600
Sales discounts		2,000
Sales returns and allowances		2,200
Cost of goods sold		38,000
Depreciation expense—Store equipment		0
Salaries expense		27,100
Insurance expense		0
Rent expense		16,000
Store supplies expense		0
Advertising expense		9,400
Totals	$	207,400		$	207,400

Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system.

Additional Information:

1. Store supplies still available at fiscal year-end amount to $1,850.
2. Expired insurance, an administrative expense, for the fiscal year is $1,450.
3. Depreciation expense on store equipment, a selling expense, is $1,650 for the fiscal year.
4. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,300 of inventory is still available at fiscal year-end.

rev: 10_24_2018_QC_CS-145044

4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2017. (Round your answers to 2 decimal places.)

Answer 1