Problem 5-5A Preparing adjusting entries and income statements; computing gross margin, acid-test, and current ratios LO A1, A2, P3, P4

[The following information applies to the questions displayed below.]

The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company.

NELSON COMPANY Unadjusted Trial Balance January 31, 2017
	Debit			Credit
Cash	$	36,350
Merchandise inventory		13,500
Store supplies		5,600
Prepaid insurance		2,500
Store equipment		42,800
Accumulated depreciationStore equipment				$	19,000
Accounts payable					18,000
J. Nelson, Capital					16,000
J. Nelson, Withdrawals		2,000
Sales					149,500
Sales discounts		2,050
Sales returns and allowances		2,300
Cost of goods sold		38,000
Depreciation expenseStore equipment		0
Salaries expense		30,300
Insurance expense		0
Rent expense		18,000
Store supplies expense		0
Advertising expense		9,100
Totals	$	202,500		$	202,500

Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system.

Additional Information:

1. Store supplies still available at fiscal year-end amount to $2,200.
2. Expired insurance, an administrative expense, for the fiscal year is $1,650.
3. Depreciation expense on store equipment, a selling expense, is $1,575 for the fiscal year.
4. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,600 of inventory is still available at fiscal year-end.

rev: 10_24_2018_QC_CS-145044

Problem 5-5A Part 4

4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2017. (Round your answers to 2 decimal places.)