Question

С https 10 Just Dew It Corporation reports the following balance sheet information for 2017 and 2018. 10 2017 and 2018 Balance Sheets Assets Liabilities and Owners Equity Current assets Current liabilities Cash $ 12,157 14,105 $ 46,382 49276 9,784 Accounts payable 29382 32815 Notes payable 54,632 8,246 57,204 Total 96,171 104,124 Total $64628 69060 $ 49,000 45,000 Common stock and paid-n s 50000 s 50000 299784 315,894 $349,784 $365,894 and owners$463,412 $479,954 Long-term debt Owners equity Retained earnings Net plant and $367241 $375,830 Total Total equity Total abities and owners $463.412 $479.954 Total assets $463.412 $479.954 Based on the balance sheets given for Just Dew it < Prey 10 of 10 Next acer 003

Answer 1

Solution:
	2017	2018
a)
Current ratio:
Current Assets/Current Liabilities	$96171/$64628	$104124/$69060
	1.488070186	1.507732407
Current ratio =	1.49 Times	1.51 Times
b)
Quick Ratio:
(Current Assets- Inventory)/Current Liabilities	($96171-$54632)/$64628	($104124-$57204)/$69060
	0.642739989	0.679409209
Quick Ratio =	0.64 Times	0.68 Times
c)
Cash Ratio:
Cash and cash Equivalent/Current Liabilities	$12157/$64628	$14105/$69060
	0.188107322	0.204242688
Cash and cash equivalent = Cash	0.19 Times	0.20 Times
d)
NWC Ratio:
Current Assets/Current Liabilities*100	$96171/$64628*100	$104124/$69060*100
	148.8070186	150.7732407
Current ratio =	148.81%	150.77%
e)
Debt-equity ratio:
Debt/Equity	($64628+$49000)/($50000+$299784)	($69060+$45000)/($50000+$315894)
	0.324851909	0.311729627
Debt = Total Liabilities
Total liabilities = Current liabilities + Long term debt
Equity = Common stock Retained Earnings
Debt-equity ratio=	0.32 Times	0.31 Times
Equity Multiplier:
Total Assets/Equity	($463412)/($50000+$299784)	($479954)/($50000+$315894)
	1.324851909	1.311729627
Equity Multiplier=	1.32 Times	1.31 Times
f)
Total Debt ratio:
Total Debt/Total Asset	($64628+$49000)/($463412)	($69060+$45000)/($479954)
	0.245198657	0.237647775
	0.25 Times	0.24 Times
Long term debt ratio:
Long term Debt/Total assets	($49000)/($463412)	($45000)/($479954)
	0.093758985	0.093758985
	0.09 Times	0.09 Times