Walker Company Has the Following Assets on January 1, 2017

question 82

Multiple Choice

Walker Company has the following assets on January 1, 2017 and January 1, 2016.
$$\begin{array} { l r r } & 1 / 1 / 17 & 1 / 1 / 16 \\\hline \text { Cash } & \$ 451,000 & \$ 366,000 \\\text { Accounts receivable } & 302,000 & 333,000 \\\text { Marketable securities } & 36,000 & 30,000 \\\text { Irventory } & 87,000 & 105,000 \\\text { Net plant and equipment } & 120,000 & 96,000\end{array}$$
If Walker's quick ratio is 3.00 for 2017, what is the amount of its current liabilities?

• A)$325,000
• B)$263,000
• C)$285,000
• D)There is not enough information to answer this question.Solution (in thousands):
• Quick ratio = ($451 + $302 + $36) / x = 3.0
• X = $263

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Definitions:

Composite Rate

A single interest rate that reflects the combination of rates applied to several different financial transactions or loans.

Residual Value

The anticipated final value of an asset after its period of utility has ended.

Sum-Of-The-Years'-Digits

A depreciation method that accelerates the expense recognition, based on a descending fraction of the sum of the year digits.