Problem: A company has current assets that total $500,000, a current ratio of 2.00, and uses the perpetual inventory method. Assume that the following transactions are completed: (1) sold $12,000 in merchandise on short-term credit for $15,000, (2) declared but did not pay dividends of $50,000, (3) paid prepaid rent in the amount of $12,000, (4) paid previously declared dividends in the amount of $50,000, (5) collected an account receivable in the amount of $12,000, and (6) reclassified $40,000 of long-term debt as a current liability. Compute the updated current ratios (use two decimal points) Transactions (1) (2) (3) (4) (5) (6) The only part I got right is transaction which is 2.01 the rest I just can't nail the right number. For transaction 2, dividends dont count as a liability right? So since 50,000 was declared and not paid there is no change in either current assets or current liabilities. Therefore I figure the ratio to be 2.00 which is not the case. For transaction 3, paying 12,000 in prepaid rent reduces 500,000-12,000=488,000. The current liabilities are 250,000 therefore that should be decreased by 12,000 as well leaving the ratio to be: 488,000/238,000=2.05 but that is also incorrect. I have similar work done for the rest but they are all wrong so could someone please show me how to do this right? What am I doing wrong. First person to show how to do this/show me what i am doing wrong will be awarded with lifesaver thanks Edit: I made a mistake for transaction 3, I know that prepaid rent is a current asset so it should be added to the 500,000 not subtracted but that did not help me either way. 512,000/250,000=2.05 still not right