Question
The most recent balance sheet of Raconteurs, Inc., (in millions) is found here: Current assets Cash and marketable securities $10.4 Accounts receivable $40.8 Inventory $59.9
The most recent balance sheet of Raconteurs, Inc., (in millions) is found here:
| Current assets | |
|---|---|
| Cash and marketable securities | $10.4 |
| Accounts receivable | $40.8 |
| Inventory | $59.9 |
| Total current assets | $111.1 |
| Current liabilities | |
| Accrued wages and taxes | $4.6 |
| Accounts payable | $35.4 |
| Notes payable | $30.3 |
| Total current liabilities | $70.3 |
.
a.Calculate Raconteurs' current ratio and acid-test (quick) ratio.
b.Benchmark ratios for the current and acid-test (quick) ratio are
1.49 and 1.21, respectively. What can you say about the liquidity of Raconteur's operations based on these two ratios?
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Finance At Work
Authors: Valérie Boussard
1st Edition
113820403X, 978-1138204034
