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    kapooktung1's Avatar
    kapooktung1 Posts: 4, Reputation: 1
    New Member
     
    #1

    Jun 12, 2007, 02:58 PM
    Acid-test ratio
    Information are:
    Year 2006 2005cash 45 35
    Short-term investments 30 27
    Accounts receivable(net) 35 25
    Inventory 65 65
    Prepaid expenses 7 9
    Accounts payble 60 54
    Salary payable 14 15
    Income taxes payable 11 13
    Bonds payable (due2009) 80 80
    Net credit sales 270 235
    Cost of goods sold 165 141
    The question is how can I compute the acid-test ratio for 2005 and 2006 ?
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
    Ultra Member
     
    #2

    Jun 13, 2007, 09:00 AM
    Acid Test Ratio = Current Assets – Inventory – Prepaids / Current Liabilities.

    What do you think the answer is? Then we will help you once you make an attempt.

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