Booker Corporation Had the Following Comparative Current Assets and Current

question 91

Essay

Booker Corporation had the following comparative current assets and current liabilities: $$\begin{array} { l r r } & \text { Dec. } 31,2017 & \text { Dec. 31, 2016 }\\\text { Current assets } \\\text { Cash } & \$ 60,000 & \$ 30,000 \\\text { Short-term investments } & 40,000 & 10,000 \\\text { Accounts receivable } &55,000 & 95,000 \\\text { Inventory } &110,000 & \$ 90,000 \\\text { Prepaid expenses } & 35,000 & \$ 20,000 \\\quad \text { Total current assets } &\$ 300,000 & \$ 245,000 \\\text { Current liabilities } & \\\text { Accounts payable } & \$ 140,000 & \$ 110,000 \\\text { Salaries payable } & 40,000 & 30,000 \\\text { Income tax payable } & 20,000 & 15,000 \\\quad \text { Total current liabilities } &\$200,000&\$155,000 \\\end{array}$$ During 2017 credit sales and cost of goods sold were $750000 and $400000 respectively.
Instructions
Compute the following liquidity measures for 2017:
1. Current ratio.
2. Working capital.
3. Acid-test ratio.
4. Accounts receivable turnover.
5. Inventory turnover.

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Definitions:

Sacrum Fracture

A break in the sacrum, the triangular bone at the base of the spine that is part of the pelvis.

Nondisplaced

Refers to a break in a bone that has not led to separation or movement of the affected parts.

Adolescent Postural Kyphosis

A curvature of the upper back that appears exaggerated, often developing during adolescence and typically related to poor posture or slouching.

Thoracolumbar Region

The area of the spine that includes the lower thoracic vertebrae and upper lumbar vertebrae, often referred to when discussing back pain or injuries.