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25 September, 13:12

SDJ, Inc., has net working capital of $2,170, current liabilities of $4,590, and inventory of $3,860. a. What is the current ratio? (Do not round intermediate calculations and round your answer to 2 decimal places, e. g., 32.16.) b. What is the quick ratio? (Do not round intermediate calculations and round your answer to 2 decimal places, e. g., 32.16.)

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  1. 25 September, 14:18
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    1.47 times; 0.63 times

    Explanation:

    Given that,

    Net working capital = $2,170,

    current liabilities = $4,590

    Inventory = $3,860

    Current assets = net working capital + current liabilities

    = $2,170 + $4,590

    = $6,760

    Current ratio = current assets : current liabilities

    = $6,760 : $4,590

    = 1.47 times

    Quick ratio = (current assets - inventory) : current liabilities

    = ($6,760 - $3,860) : $4,590

    = 0.63 times
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