Question: Calculate the current ratio for Mike & Kat Racing Company for the years given in the following comparative balance sheets: Although two years will not

Calculate the current ratio for Mike & Kat Racing Company for the years given in the following comparative balance sheets:

Although two years will not show a significant trend, what is your opinion of the direction of thisratio?

Mike & Kat Racing Company Balance Sheets December 31, 2010 December 31, 2009 Current assets: Cash .. $186,000 $192,000 85,000 170,500 14.000 461,500 Inventory . 185,000 Prepald expenses ...17000 Total assets.. Total current liatilities Total liabilittes.. $260,000 190,000 459,000 148 250 0 $267,000 452000 Shareholders' equity163,750 Total llabilites and shareholders equity.... $897000

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