# Josh Smith has compiled some of his personal financial data in order to determine his liquidity position. The data are as​ follows:AccountAmmountCash3,210Marketable securities960Checking account790Credit card payables1,150Short-term notes payable1,140a. Calculate​ Josh's liquidity ratio.b. Several of​ Josh's friends have told him that they have liquidity ratios of about 1.5. How would you analyze​ Josh's liquidity relative to his​ friends?

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Josh Smith has compiled some of his personal financial data in order to determine his liquidity position. The data are as​ follows:

 Account Ammount Cash 3,210 Marketable securities 960 Checking account 790 Credit card payables 1,150 Short-term notes payable 1,140
a. Calculate​ Josh's liquidity ratio.
b. Several of​ Josh's friends have told him that they have liquidity ratios of about 1.5. How would you analyze​ Josh's liquidity relative to his​ friends?
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Step 1

a)

Calculation of liquidity ratio:

Josh's liquidity ratio is 2.17.

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