Question

Kramer Industries has cash of $ 42 comma 000​; net Accounts Receivable of $ 47 comma 000​; shortminusterm investments of $ 13 comma 000 and inventory of $ 30 comma 000. It also has $ 30 comma 000 in current liabilities and $ 52 comma 000 in longminusterm liabilities. What is the current ratio for Kramer​ Industries?

Answer 1

Answer:

4.4

Explanation:

Given the following data from Kramer Industries -

Current assets;

Cash = $42,000

Account receivables = $47,000

short term investments = $13,000

Inventory = $30,000

Current assets = 42000 + 47000 + 13000 +30000

                        = $132,000

Current liabilities = $30,000

Current ratio = current assets/current liabilities

                     = 132000/30000

                     = 4.4

The current ratio of Kramer Industries = 4.4