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The following figures are taken from the balance sheet of XYZ Co. $ Bank 790,000 Prepaid expenses 110,000 Inventory 300,000 Taxation payable 300,000 Mortgage due

The following figures are taken from the balance sheet of XYZ Co.

$

Bank 790,000

Prepaid expenses 110,000

Inventory 300,000

Taxation payable 300,000

Mortgage due in 10 years 900,000

What is the acid test ratio?

Question 14

a.

1.33:1

b.

2:1

c.

1:1

d.

3:1

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