Required information Problem 4-5A 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 tial balance is prepared at fiscal year-end for Nelson Company Unadjusted Trial Balance January 31, 2017 Debit Credit Cash Merchandise inventory Store supplies Prepaid insurance Store equipment $ 1,000 12,500 5,800 2,400 42,900 hcoum lated depreciation $15,250 10,000 5,000 27,000 Store equipment Accounts payable Common stock Retained earnings Dividends Sales, Sales discounts Sales returns and allovances Cost of goods sold Depreciation expense-Store equipment Salaries expense Insurance expense Rent expense Store supplies expense Advertising expense Totals 2,200 111,950 2,000 2,200 38,400 35,000 15,000 ,800.200 $169,200 $169,200 Rent expense and salaries expense are equaly divided between selling activities and general and administrative activities. Nelson Company uses a perpetual Inventory system Additional Information: a. Store supplies still available at fiscal year-end amount to $1,750. b. Expired insurance, an administrative expense, for the fiscal year is $1,400 c. Depreciation expense on store equipment, a selling expense, is $1,525 for the fiscal year d. To estimate shrinkage, a physical count of ending merchandise inventory is taken, It shows $10,900 of inventory is still available at fiscal year-end Problem 4-5A 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.) Current ratio ratio Gross margin ratio