Use the balance sheets of Glover shown below to calculate the following ratios for Year 2 (round to the hundredths):(a) Current ratio.(b) Acid-test ratio.(c) Debt ratio.(d) Equity ratio.Glover CompanyBalance SheetsDecember 31, Year 2 and Year 1?Year 2Year 1Assets:??Cash$ 43,000$ 22,000Accounts receivable38,00042,000Merchandise inventory61,00052,000Prepaid insurance6,0009,000Long-term investments49,00020,000Plant assets (net) 218,000 218,000Total assets$415,000$363,000???Liabilities and Equity:??Current liabilities$ 62,000$ 75,000Long-term liabilities45,00036,000Common stock150,000150,000Retained earnings 158,000 102,000Total liabilities and equity$415,000$363,000??
What will be an ideal response?
| (a) ($43,000 + $38,000 + $61,000 + $6,000)/$62,000 = | 2.39 |
| ? | ? |
| (b) ($43,000 + $38,000)/$62,000 = | 1.31 |
| ? | ? |
| (c) ($62,000 + $45,000)/$415,000 = | 25.78% |
| ? | ? |
| (d) ($150,000 + $158,000)/$415,000 = | 74.22% |
| ? |
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