Receivables and Revenue Evaluate liquidity using the quick (acid-test) ratio and days' sales in receivables Northern Products reported the following amounts in its 2019 financial statements. The 2018 amounts are given for comparison 2019 2018 $9,500 10,500 $9,500 7,000 $86,500 17,500) $70,100 (5,500) Current assets: Cash Short-term investments Accounts receivable Less: Allowance for uncollectibles Inventory Prepaid insurance Total current assets Total current liabilities Net sales (all on account) 79,000 189,000 2,200 290,200 99,000 1,077,000 64,600 190,000 2,200 273,300 106,000 734,000 Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong. Requirements 1 Compute Northern's quick (acid-test) ratio at the end of 2019. How does the quick ratio compare with the industry average of 0.922 2 Calculate the days' sales outstanding for 2019 and compare it with the company's credit terms of net 30 days. Use the Excel ROUNDUPO) function to find the DSO value. Round to the next whole number b. Use a 365-day year for calculations as needed. a 1. Compute Northern's quick (acid-test) ratio at the end of 2019. How does the quick ratio compare with the industry average of 0.92? (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong.) Quick (acid-test) ratio Comparison of quick ratio to industry average 2. Calculate the days' sales outstanding for 2019 and compare it with the company's credit terms of net 30 days. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instruction tab you will be marked wrong.) One day sales Days' sales in receivables (DSO) days Comparison of DSO to credit terms