On December 31, Year 1, Houston Company's Total Current Assets

Essay

On December 31, Year 1, Houston Company's total current assets were $560,000 and its total current liabilities were $420,000. On January 1, Year 2, Houston issued a long-term note to a bank for $30,000 cash.Required:(a)Compute Houston's working capital (1)before and (2)after issuing the note payable.(b)Compute Houston's current ratio (1)before and (2)after issuing the note payable. Round your answer to two decimal places.