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Compute the current ratio and acid-test ratio for each of the following separate cases. (Round ratios to two decimals.) Which company case is in the best position to meet short-term obligations? Explain. Cash........ Short-term investments Current receivables. Inventory. Prepaid expenses. Total current assets Current liabilities. Case X Case Y $2,000 0 $ 110 0 590 2,300 500 $3,500 Case Z $1,000 600 350 700 2,650 4,100 200 900 $5,200 $7,300 $2,200 $1,200 $3,750

Compute the current ratio and acid-test ratio for each of the following separate cases. (Round ratios to two decimals.) Which company case is in the best position to meet short-term obligations? Explain. Cash........ Short-term investments Current receivables. Inventory. Prepaid expenses. Total current assets Current liabilities. Case X Case Y $2,000 0 $ 110 0 590 2,300 500 $3,500 Case Z $1,000 600 350 700 2,650 4,100 200 900 $5,200 $7,300 $2,200 $1,200 $3,750

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Compute the current ratio and acid-test ratio for each of the following separate cases. (Round ratios to two decimals.) Which company case is in the best position to meet short-term obligations? Explain. Cash....... Short-term investments Current receivables.. Inventory. ... Prepaid expenses. Total current assets Current liabilities Case X $2,000 0 350 2,650 200 $5,200 $2,200 Case Y Case Z $ 110 $1,000 0 600 590 700 2,300 4,100 500 900 $3,500 $7,300 $1,200 $3,750
Transcribed Image Text:Compute the current ratio and acid-test ratio for each of the following separate cases. (Round ratios to two decimals.) Which company case is in the best position to meet short-term obligations? Explain. Cash....... Short-term investments Current receivables.. Inventory. ... Prepaid expenses. Total current assets Current liabilities Case X $2,000 0 350 2,650 200 $5,200 $2,200 Case Y Case Z $ 110 $1,000 0 600 590 700 2,300 4,100 500 900 $3,500 $7,300 $1,200 $3,750
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