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Today, 12:35

Assume cash = $500, notes payable in six months = $600, accounts receivable = $900, inventory = $1,500, and accounts payable = $1,100. What is the quick ratio?

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  1. Today, 13:25
    0
    0.82 times

    Explanation:

    The computation of the quick ratio is shown below:

    Quick ratio = Quick assets : total current liabilities

    where,

    Quick assets = Cash + accounts receivable

    = $500 + $900

    = $1,400

    And, the current liabilities is

    = Notes payable in six months + accounts payable

    = $600 + $1,100

    = $1,700

    So, the value would equal to

    = $1,400 : $1,700

    = 0.82 times

    The inventory is not included.
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