Question
Calculating the Current Ratio and the Quick (or Acid-Test) Ratio LoLo Lemon Company has current assets equal to $500,000. Of these, $300,000 is cash, $75,000
Calculating the Current Ratio and the Quick (or Acid-Test) Ratio LoLo Lemon Company has current assets equal to $500,000. Of these, $300,000 is cash, $75,000 is accounts receivable, $125,000 is inventory, and the remainder is marketable securities. Current liabilities total $425,000. Required: Note: Round answers to two decimal places.
1. Calculate the current ratio.
2. Calculate the quick ratio (acid-test ratio).
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Financial Accounting An International Introduction
Authors: David Alexander, Prof Christopher Nobes, Chris W. Nobes
4th Edition
027372164X, 978-0273721642
