Question: 1. Calculate the Current Ratio, the Quick ratio and working capital for a restaurant from the following data: Cash $14,000 Credit Card Receivables $950 Accounts

1. Calculate the Current Ratio, the Quick ratio and working capital for a restaurant from the following data:

Cash

$14,000

Credit Card Receivables

$950

Accounts Receivable

$1,260

Quick Assets

Food Inventory

$4,000

Prepaid Expense

$1,200

Current Assets

Current Liabilities

$12,500

Quick (or Acid Test) Ratio:

Quick Ratio Formula:

Current Ratio:

Current Ratio Formula:

Working Capital

Working Capital Formula:

2. A restaurant reported the following inventory and cost of sales for July which had 31 operating days. Calculate the inventory turnover and days of inventory ratios.

	Inventory July 1	$ 8,300
	Inventory July 31	$ 8,800
	Inventory Average
	Cost of Sales	$ 39,000
	Inventory Turnover

	Operating days in July

	Average Days of Inventory

	Inventory Turnover Ratio Formula:


	Days of Inventory Formula:

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