Current assets totaled $$54,000$ and the current ratio was $1\mathrm{.}5.$ Assume that the following transactions were completed: $(1)$ purchased merchandise for $$7,000$ on short$-$term credit and $(2)$ purchased a delivery truck for $$12,000,$ paid $$3,000$ cash, and signed a two$-$year interest$-$bearing note for the balance.

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Required:

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Compute the cumulative current ratio after each transaction.$($Round your answers to $2$ decimal places.$)$

$$Comparative financial statements for Heritage Antiquing Services for the fiscal year ending December $31$ appear on the following page. The company did not issue any new common or preferred stock during the year. A total of $600,000$ shares of common stock were outstanding. The interest rate on the bond payable was $10\%,$ the income tax rate was $40\%,$ and the dividend per share of common stock was $$0\mathrm{.}75.$ The market value of the company$$s common stock at the end of the year was $$26.$ All of the company$$s sales are on account.

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Heritage Antiquing Services Comparative Balance Sheet$($dollars in thousands$)$This YearLast YearAssets$$Current assets:$$Cash$$1,080$$$1,210$Accounts receivable, net$9,0006,500$Inventory$12,00010,600$Prepaid expenses$600500$Total current assets$22,68018,810$Property and equipment:$$Land$9,0009,000$Buildings and equipment, net$36,80038,000$Total property and equipment$45,80047,000$Total assets$$68,480$$$65,810$Liabilities and Stockholders' Equity$$Current liabilities:$$Accounts payable$$18,500$$$17,400$Accrued payables$900700$Notes payable, short term$-100$Total current liabilities$19,40018,200$Long$-$term liabilities:$$Bonds payable$8,0008,000$Total liabilities$27,40026,200$Stockholders' equity:$$Preferred stock$1,0001,000$Common stock$2,0002,000$Additional paid$-$in capital$4,0004,000$Total paid$-$in capital$7,0007,000$Retained earnings$34,08032,610$Total stockholders' equity$41,08039,610$Total liabilities and stockholders' equity$$68,480$$$65,810$

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Heritage Antiquing ServicesComparative Income Statement and Reconciliation$($dollars in thousands$)$This YearLast YearSales$$66,000$$$64,000$Cost of goods sold$43,00042,000$Gross margin$23,00022,000$Selling and administrative expenses:$$Selling expenses$11,50011,000$Administrative expenses$7,4007,000$Total selling and administrative expenses$18,90018,000$Net operating income$4,1004,000$Interest expense$800800$Net income before taxes$3,3003,200$Income taxes$1,3201,280$Net income$1,9801,920$Dividends to preferred stockholders$60400$Net income remaining for common stockholders$1,9201,520$Dividends to common stockholders$450450$Net income added to retained earnings$1,4701,070$Retained earnings, beginning of year$32,61031,540$Retained earnings, end of year$$34,080$$$32,610$

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Required:

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Compute the following financial data for short$-$term creditors for this year:

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$1.$ Current ratio. $($Round your answer to $2$ decimal places.$)$

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$2.$ Acid$-$test ratio. $($Round your answer to $2$ decimal places.$)$

$$Rightway Products had a current ratio of $2\mathrm{.}5$ on June $30$ of the current year. On that date, the company$$s assets were as follows:

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$$Cash$$80,000$Accounts receivable, net$460,000$Inventory$750,000$Prepaid expenses$10,000$Plant and equipment, net$1,900,000$Total assets$$3,200,000$

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Required:

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$1.$ What was the company$$s working capital on June $30?($Omit the $"$$$"$ sign in your response.$)$

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$2.$ What was the company$$s acid$-$test ratio on June $30?($Round your answer to $2$ decimal places.$)$

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$3.$ The company paid an account payable of $$100,000$ immediately after June $30.$

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a$.$ What effect did this transaction have on working capital?

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multiple choice $1$

Working capital would increase.

Working capital would decrease.

Working capital would not be affected.

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b$.$ What effect did this transaction have on the current ratio?

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multiple choice $2$

Current ratio would increase.

Current ratio would decrease.

Current ratio would not be affected.

Janice$$s Dress Delivery operates a mail$-$order business that sells clothes designed for frequent travelers. It had sales of $$560,000$ in December. Because Janice$$s Dress Delivery is in the mail$-$order business, all sales are made on account. The company expects a $30$ percent drop in sales for January. The balance in the Accounts Receivable account on December $31$ was $$96,400$ and is budgeted to be $$73,600$ as of January $31.$ Janice$$s Dress Delivery normally collects accounts receivable in the month following the month of sale.

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Required:

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Determine the amount of cash Janice$$s Dress Delivery expects to collect from accounts receivable during January. $($Omit the $"$$$"$ sign in your response.$)$