Question: 1) Based on the following data, what is the quick ratio, rounded to one decimal point? Accounts payable $ 30,000 Accounts receivable 65,000 Accrued liabilities
1) Based on the following data, what is the quick ratio, rounded to one decimal point?
| Accounts payable | $ 30,000 |
| Accounts receivable | 65,000 |
| Accrued liabilities | 7,000 |
| Cash | 20,000 |
| Intangible assets | 40,000 |
| Inventory | 72,000 |
| Long-term investments | 100,000 |
| Long-term liabilities | 75,000 |
| Marketable securities | 36,000 |
| Notes payable (short-term) | 20,000 |
| Property, plant, and equipment | 625,000 |
| Prepaid expenses | 2,000 |
| a. | 2.4 |
| b. | 3.4 |
| c. | 2.1 |
| d. | 1.5 |
2) A company with working capital of $400,000 and a current ratio of 2.5 pays a $75,000 short-term liability. The amount of working capital immediately after payment is
| a. | $475,000 |
| b. | $325,000 |
| c. | $400,000 |
| d. | $75,000 |
3) Based on the following data for the current year, what is the inventory turnover?
| Net sales on account during year | $ 500,000 |
| Cost of merchandise sold during year | 330,000 |
| Accounts receivable, beginning of year | 45,000 |
| Accounts receivable, end of year | 35,000 |
| Inventory, beginning of year | 90,000 |
| Inventory, end of year | 110,000 |
| a. | 3.3 |
| b. | 8.3 |
| c. | 3.7 |
| d. | 3.0 |
4) The Rand Corporation began the current year with a retained earnings balance of $25,000. During the year, the company corrected an error made in the prior year. The error was due to the accountant failing to record depreciation expense of $3,000 on equipment. Also, during the current year, the company earned net income of $12,000 and declared cash dividends of $5,000. Compute the year end retained earnings balance.
| a. | $29,000 |
| b. | $35,000 |
| c. | $39,000 |
| d. | $45,000 |
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