Problem: Shown below are selected items appearing in a recent balance sheet of Kellogs products. (Dollar amounts are in the thousands)
Cash and cash equivalents...$420
Investments in marketable securities...100
Receivables...1,200
Inventories...900
Prepaid expense and other current assets...250
Plant and equipment...3,100
Accounts payable...1,400
Bank loans payable within one year...100
Income taxes payable...100
Retained earnings...1,500
A) Compute the following:
1)Total quick assets$___________
2)Total current assets$_________
3)Total current liabilities$_________
4)Quick ratio__________to 1
5)Current ratio ________to 1
B) Reasearch indicates an industry average quick ratio is 1.3 to 1, and a current ratio of 2.3 to 1. Based upon this information, does Kellog products appear more or less solvent than the average company in its industry? Explain briefly.