SDJ, Inc., has net working capital of $3,390, current liabilities of $4,610, and inventory of $4,700.   

What is the current ratio? (Round your answer to 2 decimal places. (e.g., 32.16))

 

Current ratio

times

  

What is the quick ratio? (Round your answer to 2 decimal places. (e.g., 32.16))

  

Quick ratio

times

Explanation:

The formula for NWC:

  

NWC = CA – CL

CA = CL + NWC = $3,390 + 4,610 = $8,000

  

So, the current ratio is:

Current ratio = CA / CL = $8,000 / $4,610 = 1.74 times

  

And the quick ratio is:

Quick ratio = (CA − Inventory) / CL = ($8,000 − 4,700) / $4,610 = 0.72 times