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The Financial Statements for Stephens' Electric Company Include the Following

question 7

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The financial statements for Stephens' Electric Company include the following items: 20172016 Cash $55,000$51,000 Cash Equivalents 23,50020,000 Net Accounts Receivable 30,00026,000 Merchandise Inventory 81,00065,000 Total Assets 530,000548,000 Accounts Payable 44,50035,000 Salaries Payable 24,00020,000 Long-term Note Payable 61,00057,000 Income From Operations 124,500115,000 Interest Expense 28,00033,000\begin{array} { l r r } & 2017 & 2016 \\\text { Cash } & \$ 55,000 & \$ 51,000 \\\text { Cash Equivalents } & 23,500 & 20,000 \\\text { Net Accounts Receivable } & 30,000 & 26,000 \\\text { Merchandise Inventory } & 81,000 & 65,000 \\\text { Total Assets } & 530,000 & 548,000 \\\text { Accounts Payable } & 44,500 & 35,000 \\\text { Salaries Payable } & 24,000 & 20,000 \\\text { Long-term Note Payable } & 61,000 & 57,000 \\\text { Income From Operations } & 124,500 & 115,000 \\\text { Interest Expense } & 28,000 & 33,000\end{array} Compute the 2016 cash ratio.(Round your answer to two decimal places. )


Definitions:

Call Option

A financial contract giving the buyer the right, but not the obligation, to purchase an asset at a specified price within a certain time period.

Spot Exchange Rates

The current exchange rate at which a currency can be bought or sold for immediate delivery.

Speculative Derivatives

Financial instruments used to speculate on the future movements of asset prices, without intention of holding the underlying assets.

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