Willingham Ltd. has the following comparative statements of financial position data.

Additional information for 2020:
1. Net income was £28,000.
2. Sales on account were £418,000. Sales returns and allowances were £22,000.
3. Cost of goods sold was £190,000.

Instructions

Compute the following ratios at December 31, 2020.

a. Current ratio.

b. Acid-test ratio. 

c. Accounts receivable turnover.

d. Inventory turnover.

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Willingham Ltd. Statements of Financial Position December 31 2020 2019 Plant assets (net) £205,000 60,000 £190,000 50,000 Inventory Accounts receivable (net) 70,000 50,000 Cash 10,000 30,000 £320,000 £345,000 Share capital-ordinary, £10 par Retained earnings Mortgage payable (6%) Accounts payable £140,000 55,000 100,000 50,000 £120,000 40,000 100,000 60,000 £345,000 £320,000