Question
A business has current assets of $400,000 and current liabilities of $250,000. The company's inventory is $100,000, accounts receivable is $150,000, and cash is $150,000.
A business has current assets of $400,000 and current liabilities of $250,000. The company's inventory is $100,000, accounts receivable is $150,000, and cash is $150,000. Calculate the working capital, the current ratio, and the quick ratio. Discuss the implications of these ratios on the company's liquidity position.
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Financial Accounting The Impact on Decision Makers
Authors: Gary A. Porter, Curtis L. Norton
9th edition
130565417X, 1305654174, 9781285972572 , 978-1285182964
