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Figure out current ratio and quick ratio as per this data: Current Assets: Cash 14,000 Accounts Receivable 45,489 Inventory 39,239 Prepaid expenses 3,400 total current assets 102,128 Current Liabilities: Accounts payable 98,789 Other current liabilities 3,456 Total Current liabilities 102,245
Figure out current ratio and quick ratio as per this data:
Current Assets:
Cash 14,000
Accounts Receivable 45,489
Inventory 39,239
Prepaid expenses 3,400
total current assets 102,128
Current Liabilities:
Accounts payable 98,789
Other current liabilities 3,456
Total Current liabilities 102,245
Expert Solution
Figure out current ratio and quick ratio as per this data:
Current Assets:
Cash 14,000
Accounts Receivable 45,489
Inventory 39,239
Prepaid expenses 3,400
total current assets 102,128
Current Liabilities:
Accounts payable 98789
Other current liabilities 3456
Total Current liabilities 102,245
Current ratio = Current Assets / Current Liabilities= 0.9989 =102128/102245
Quick ratio = (Cash + Accounts receivables)/ Current Liabilities= 0.5818 =(14000+45489) /102245
Answer:
Current Ratio= 0.9989
Quick ratio= 0.5818
Quick Ratio. It eliminates certain current assets such as inventory and prepaid expenses that may be more difficult to convert to cash.
Quick Ratio = (Cash + Accounts Receivable + Short-Term or Marketable Securities) / (Current Liabilities)
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