Hocus Pocus Corporation has the following list of accounts and balances after posting its closing entries:

a$)$ ?Calculate the current ratio and the debt ratio. Assume the unearned service revenue will be earned within six months. Round to two decimals.

b$)$ ?Assume on December $31,2023,$ ?Hocus Pocus Corporation borrows $$50,000$ ?from the First Street Bank and issues a $6\%,6-$month note. Recalculate the current ratio and the debt ratio. Round to two decimals.

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Cash Accounts receivable Supplies Prepaid insurance Building Hocus Pocus Corporation Trial Balance December 31, 2023 Accumulated depreciation-building Equipment Accumulated depreciation-equipment Accounts payable Unearned service revenue Salary payable Common shares Retained earnings Debit $24,500 5,400 850 2,100 40,500 $7,500 22,300 $95,650 Credit 3,400 6,500 8,400 900 50,200 18,750 $95,650 Cash Accounts receivable Supplies Prepaid insurance Building Hocus Pocus Corporation Trial Balance December 31, 2023 Accumulated depreciation-building Equipment Accumulated depreciation-equipment Accounts payable Unearned service revenue Salary payable Common shares Retained earnings Debit $24,500 5,400 850 2,100 40,500 $7,500 22,300 $95,650 Credit 3,400 6,500 8,400 900 50,200 18,750 $95,650

Answer rating: 100% (QA)

Based on the provided trial balance for Hocus Pocus Corporation we can calculate the current ratio and the debt ratio a Calculation of Current Ratio T... View the full answer