Question

Current assets for Mayfair Corporation totaled $410,000 and the current ratio was 2.0. Assume that the following transactions were completed:
(1) Sold $11,000 in merchandise on short-term credit,
(2) Declared but did not pay dividends of $50,000,
(3) Paid prepaid rent in the amount of $12,000,
(4) Paid previously declared dividends in the amount of $50,000,
(5) Collected an account receivable in the amount of $11,000, and
(6) Reclassified $45,000 of long-term debt as a short-term liability.

Required:
Compute the cumulative current ratio after each transaction.



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  • CreatedJuly 01, 2014
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