Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the following current assets and current liabilities at the end of two recent years: a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place. b. The liquidity of Sherwood has increaseddecreasedremained constant some over this time period. Both the current and quick ratios have increaseddecreasedremained constant . Sherwood is a strongweak company with ampleinsufficient resources for meeting short-term obligations. Its liquidity as measured by the current and quick ratios has improveddeterioratedremained constant during this period. Current Year Previous Year (in millions) (in millions) Cash and cash equivalents $5,149 $5,599 Short-term investments, at cost 3,658 10,397 Accounts and notes receivable, net 11,626 10,664 Inventories 1,460 973 Prepaid expenses and other current assets 486 360 Short-term obligations 389 4,132 Accounts payable 9,341 9,198 .

1. Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the
following current assets and current liabilities at the end of two recent years:
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
b. The liquidity of Sherwood has
increaseddecreasedremained constant
some over this time period. Both the current and quick ratios have
increaseddecreasedremained constant
. Sherwood is a
strongweak
company with
ampleinsufficient
resources for meeting short-term obligations. Its liquidity as measured by the current and quick
ratios has
improveddeterioratedremained constant
during this period.
Current Year
(in millions)
Previous Year
(in millions)
Cash and cash equivalents $5,149 $5,599
Short-term investments, at cost 3,658 10,397
Accounts and notes receivable, net 11,626 10,664
Inventories 1,460 973
Prepaid expenses and other current assets 486 360
Short-term obligations 389 4,132
Accounts payable 9,341 9,198