Financial statement data of Greatland Engineering include the following items:

Requirements

1. Calculate Greatland’s current ratio, debt ratio, and earnings per share. Round all ratios to two decimal places.

2. Calculate the three ratios after evaluating the effect of each transaction that follows. Consider each transaction separately.

a. Borrowed $105,000 on a long-term note payable

b. On January 1, issued 40,000 shares of common stock, receiving cash of $360,000

c. Paid off short-term notes payable, $28,000

d. Purchased $43,000 of merchandise on account, debiting Inventory

e. Received cash on account, $17,000

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Accounts payable . Accrued liabilities. . Long-term notes payable . Other long-term liabilities.. Net income.. Cash Short-term investments.. Accounts receivable, net.. Inventories ... Prepaid expenses . $ 26,000 $107,000 ..... 36,000 32,000 85,000 163,000 34,000 147,000 6,000 677,000 49,000 99,000 Number of common assets ...... Short-term notes payable.. shares outstanding. . 46,000 ......