The Following Balance Sheet Information Is Provided for Duke Company

The following balance sheet information is provided for Duke Company for Year 2: What is the company's current ratio (rounded to two decimal points) ?
$\begin{array}{|l|r|}\hline \text { Assets } \\\hline \text { Cash } & \$5,400 \\\hline \text { Accounts receivable } & 15,500 \\\hline \text { Inventory } & 18,000 \\\hline \text { Prepaid expenses } & 1,600 \\\hline \text { Phant and equipment, net of depreciation } &20,200 \\\hline \text { Land } & 19,950 \\\hline \text { Total assets }&\$80,650\\\hline \text { Liabilities and Stockholders' Equity }\\\hline \text { Accounts payable } & \$ 4,500 \\\hline \text { Salaries payable } & 11,500 \\\hline \text { Bonds payable (Due in 2020) } & 19,000 \\\hline \text { Common stock, no par } & 30,000 \\\hline \text { Retained earnings } & 15,650 \\\hline \text { Total liabilities and stockholder' equity }&\$80,650\\\hline\end{array}$

A) 1.16
B) 1.31
C) 2.53
D) 3.79

Correct Answer:

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