The bond indenture for the 10-year, 8% debenture bonds dated January 2, 20Y8, required working capital of $200,000, a current ratio of 2.0, and a quick ratio of 1.0 at the end of each calendar year until the bonds mature. At December 31, 20Y9, the three measures were computed as follows:

a. List the errors in the determination of the three measures of current position analysis.
b. Is the company satisfying the terms of the bond indenture?

1. Current assets: Temporary investments Accounts receivable (net) Property, plant, and equipment Total current assets (net) 1,320,000 Current liabilities: Accounts and short-term notes payable Accrued liabilities $440,000 160,000 Total current liabilities (600,000) $ 720,000 $1,320,000 $600,000 $660,000$440,000