Consider the following information taken from GER's financial statements: September 30 (in thousands) 2020 2019 Current assets: Cash and cash equivalents $1,274 $6,450 Receivables 30,071 16,548 Inventories 31,796 14,072 Other current assets 4,818 2,620 Total current assets $67,959 $39,690 Current liabilities: Current portion of long-term debt $97 $3,530 Accounts payable 23,124 11,228 Accrued compensation costs 5,606 1,929 Accrued expenses 9,108 5,054 Other current liabilities 874 777 Total current liabilities $38,809 $22,518 Also, GER's operating cash flows were $11,255 and $13,736 in 2020 and 2019, respectively. Round your answers to two decimal places. 2. Calculate the quick ratios for 2020 and 2019. Quick Ratio 2020 ?? 2019 ?? 3. Calculate the cash ratios for 2020 and 2019. Cash Ratio 2020 ?? 2019 ?? 5. Conceptual Connection: What are some reasons why GER's liquidity may be considered to be improving and some reasons why it may be worsening? GER’s liquidity appears to hold constant when one looks only at the _______ ratio . However, because the ___________ may not be easily converted to cash, the liquidity of GER may be worsening.
Consider the following information taken from GER's financial statements: September 30 (in thousands) 2020 2019 Current assets: Cash and cash equivalents $1,274 $6,450 Receivables 30,071 16,548 Inventories 31,796 14,072 Other current assets 4,818 2,620 Total current assets $67,959 $39,690 Current liabilities: Current portion of long-term debt $97 $3,530 Accounts payable 23,124 11,228 Accrued compensation costs 5,606 1,929 Accrued expenses 9,108 5,054 Other current liabilities 874 777 Total current liabilities $38,809 $22,518 Also, GER's operating cash flows were $11,255 and $13,736 in 2020 and 2019, respectively. Round your answers to two decimal places. 2. Calculate the quick ratios for 2020 and 2019. Quick Ratio 2020 ?? 2019 ?? 3. Calculate the cash ratios for 2020 and 2019. Cash Ratio 2020 ?? 2019 ?? 5. Conceptual Connection: What are some reasons why GER's liquidity may be considered to be improving and some reasons why it may be worsening? GER’s liquidity appears to hold constant when one looks only at the _______ ratio . However, because the ___________ may not be easily converted to cash, the liquidity of GER may be worsening.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter9: Long-term Liabilities
Section: Chapter Questions
Problem 89E: Ratio Analysis Rising Stars Academy provided the following information on its 2019 balance sheet and...
Related questions
Question
Practice Pack
Consider the following information taken from GER's financial statements:
September 30 (in thousands) |
|||
2020 | 2019 | ||
Current assets: | |||
Cash and cash equivalents | $1,274 | $6,450 | |
Receivables | 30,071 | 16,548 | |
Inventories | 31,796 | 14,072 | |
Other current assets | 4,818 | 2,620 | |
Total current assets | $67,959 | $39,690 | |
Current liabilities: | |||
Current portion of long-term debt | $97 | $3,530 | |
Accounts payable | 23,124 | 11,228 | |
Accrued compensation costs | 5,606 | 1,929 | |
Accrued expenses | 9,108 | 5,054 | |
Other current liabilities | 874 | 777 | |
Total current liabilities | $38,809 | $22,518 |
Also, GER's operating cash flows were $11,255 and $13,736 in 2020 and 2019, respectively.
Round your answers to two decimal places.
2. Calculate the quick ratios for 2020 and 2019.
Quick Ratio | |
2020 | ?? |
2019 | ?? |
3. Calculate the cash ratios for 2020 and 2019.
Cash Ratio | |
2020 | ?? |
2019 | ?? |
5. Conceptual Connection: What are some reasons why GER's liquidity may be considered to be improving and some reasons why it may be worsening?
GER’s liquidity appears to hold constant when one looks only at the _______ ratio . However, because the ___________ may not be easily converted to cash, the liquidity of GER may be worsening.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Includes step-by-step video
Trending now
This is a popular solution!
Learn your way
Includes step-by-step video
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning