Question

The following financial statement information is available for Buil Corporation:

2015

2014
Inventory
$ 44,000
$ 43,000

Current assets
80,000
106,000

Total assets
432,000
358,000

Current liabilities
25,000
36,000

Total liabilities
102,000
88,000

The current ratio for 2015 is
A) .31:1.
B) 3.2:1.
C) 1.5:1.
D) 4.24:1.

Answer 1

The current ratio of Buil Corporation for 2015 is calculated by dividing its current assets ($80,000) by its current liabilities ($25,000), resulting in a ratio of 3.2:1.

Step-by-step explanation:

To find the current ratio for 2015, we need to divide current assets by current liabilities. The current assets for 2015 are $80,000 and the current liabilities are $25,000. So the current ratio is $80,000 / $25,000 = 3.2:1. The current ratio is calculated by dividing a company's current assets by its current liabilities. In the case of Buil Corporation, the current assets for 2015 are $80,000 and the current liabilities are $25,000. Using this information, we can calculate the current ratio for 2015 as follows:

Current Ratio = Current Assets / Current Liabilities
Current Ratio = $80,000 / $25,000
Current Ratio = 3.2:1

Thus, the correct answer is B) 3.2:1.