Worthy Hills Corporation reported the following current accounts at December 31, 2010 (amounts in thousands):Cash………………………………………… $1,800Receivables……………………………….. 5,300Inventory………………………………….. 2,300Prepaid expenses……………………….. 1,100Accounts payable………………………. 2,800Unearned revenue………………………. 1,100Accrued expenses payable…………… 2,000During 2011, Worthy Hills completed these selected transactions:Sold services on account, $8,700Depreciation expense, $700Paid for expenses, $7,400Collected from customers on account, $7,500Accrued expenses, $300Paid on account, $1,500Used up prepaid expenses, $400Compute Worthy Hills’s current ratio at December 31, 2010 and again at December 31, 2011. Did the current ratio improve or deteriorate during 2011? Comment on the level of the Company’s current ratio.View Solution:
Worthy Hills Corporation reported the following current accounts



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