The following extracts of the financial statements of ABC limited have been obtained: Inventories Receivables Cash...

 

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The following extracts of the financial statements of ABC limited have been obtained: Inventories Receivables Cash Loan repayable 2028 Payables Overdraft What is the quick ratio? 31/12/2020 £130,000 £80,000 £10,000 £90,000 £70,000 £34,000 ABC has a 85% owned subsidiary XYZ. During the year ABC sold inventory to XYZ for an invoiced price of £400,000. XYZ have since sold 75% of that inventory to third parties. The sale was at a mark up of 25% on cost to ABC. What is the adjustment to the inventory that would be included in the consolidated statement of financial position of ABC at the year-end resulting from this sale? The following extracts of the financial statements of ABC limited have been obtained: Inventories Receivables Cash Loan repayable 2028 Payables Overdraft What is the quick ratio? 31/12/2020 £130,000 £80,000 £10,000 £90,000 £70,000 £34,000 ABC has a 85% owned subsidiary XYZ. During the year ABC sold inventory to XYZ for an invoiced price of £400,000. XYZ have since sold 75% of that inventory to third parties. The sale was at a mark up of 25% on cost to ABC. What is the adjustment to the inventory that would be included in the consolidated statement of financial position of ABC at the year-end resulting from this sale?

Answer rating: 100% (QA)

To calculate the quick ratio we need to use the formula Quick Ratio Cash Receivables Current Liabili... View the full answer