The following items are reported on a company’s balance sheet:Cash                                             $100,000Marketable securities                      50,000Accounts receivable (net)                60,000Inventory                                         70,000Accounts payable                            140,000Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.

Asked Dec 23, 2019

The following items are reported on a company’s balance sheet:
Cash                                             $100,000
Marketable securities                      50,000
Accounts receivable (net)                60,000
Inventory                                         70,000
Accounts payable                            140,000
Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.


Expert Answer

Step 1


Compute current ratio....


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Current assets Current ratio Current liabilities $280, 000 S140,000 = 2.0


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