Evans, Inc., had current liabilities at November 30 of $137,400. The firms current ratio at that date

Question:

Evans, Inc., had current liabilities at November 30 of $137,400. The firm’s current ratio at that date was 1.8.

Required:
a. Calculate the firm’s current assets and working capital at November 30.
b. Assume that management paid $30,600 of on November 29. Calculate the current ratio and working capital at November 30 as if the November 29 payment had not been made. Round your current ratio answer to two decimal places.
c. Explain the changes, if any, to working capital and the current ratio that would be caused by the November 29 payment.

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...