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Question(s) / Instruction(s):

Sanderson Company’s year-end balance sheets follow.

                At December 31               2012                                     2011                                      2010

 Assets:                                                                                                                                                

 Cash                                                    $32,846                $38,394                $39,206 

 Accounts receivable, net             91,466                                 67,190                                  50,722 

 Merchandise inventory                                118,521                               87,046                                  56,235 

 Prepaid expenses                           10,474                                 9,980                                    4,442 

 Plant assets, net                              292,496                                267,910                                241,495                 

 Total assets                                      $545,803                             $470,520                             $392,100 

 

Liabilities and Equity:                                                                                                                                    

 Accounts payable                          $137,264                             $80,313                $52,275 

Long-term notes payable secured by

Mortgages on plant assets           101,585                                111,466                                85,788 

Common stock, $10 par value     162,500                               162,500                 162,500 

Retained earnings                          144,454                 116,241                               91,537

Total liabilities and equity          $545,803                            $470,520                             $392,100 

 

Required:

(1)          Compute the current ratio for the year ended 2012, 2011, and 2010.

(2)          Compute the acid-test ratio for the year ended 2012, 2011, and 2010.

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