Park Corporation began the month of May with $650,000 of current assets, a current ratio of 2.50:1, and an acid test ratio of 1.10:1. During the month, it completed the following transactions (the company uses a perpetual inventory system).
May 2 Purchased $75,000 of merchandise inventory on credit.
8 Sold merchandise inventory that cost $58,000 for $103,000 cash.
10 Collected $19,000 cash on an account receivable.
15 Paid $21,000 cash to settle an account payable.
17 Wrote off a $3,000 bad debt against the Allowance for Doubtful Accounts account.
22 Declared a $1 per share cash dividend on its 40,000 shares of outstanding common stock.
26 Paid the dividend declared on May 22.
27 Borrowed $75,000 cash by giving the bank a 30 day, 10% note.
28 Borrowed $90,000 cash by signing a long term secured note.
29 Used the $165,000 cash proceeds from the notes to buy new machinery.
Required
Prepare a table showing Park’s (1) current ratio, (2) acid test ratio, and (3) working capital, after each transaction. Round ratios to two decimals.