Question: Problem 2.5 Based on your answers to problem 2.4, calculate working capital, the current ratio, and the quick (acid test) ratio of The Clothing Outlet,

Problem 2.5 Based on your answers to problem 2.4, calculate working capital, the current ratio, and the quick (acid test) ratio of The Clothing Outlet, Inc. as of December 31, 20X9. Based on your answers to problem 2.4, calculate the gross profit ratio of The Clothing Outlet, Inc. for the year ended December 31, 20X9. Suppose the industrys gross profit ratio is currently, and had been in past years, approximately 45% and that The Clothing Outlet Inc.s gross profit ratio had been at approximately industry average in past years. Based on your calculation of the Clothing Outlet Inc.s gross profit ratio in part (b) for 20X9, what may be occurring?

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