Question

has the following current assets: cash, $1,200; receivables, $1,500; inventory, $2,000 and other current assets, $1,300. Airline Accessories has the following liabilities: accounts payable, $1,000 million; current portion of long-term debt, $3,000; and long-term debt, $1,800. Based on these amounts, calculate the current ratio and working capital

Answer 1

Current Ratio = 1.5

Working Capital = $2,000 million

Step-by-step explanation:

Current Ratio = Current Assets / Current Liabilities

= ($1,200 + $1,500 + $2,000 + $1,300) / ($1,000 + $3,000)

= $6,000 / $4,000

= 1.5

Working Capital = Current Assets - Current Liabilities

= $6,000 million - $4,000 million

= $2,000 million