Josh Smith has compiled some of his personal financial data in order to determine his liquidity position. The data are as follows: Account Ammount Cash 3,210 Marketable securities 960 Checking account 790 Credit card payables 1,150 Short-term notes payable 1,140 a. Calculate Josh's liquidity ratio. b. Several of Josh's friends have told him that they have liquidity ratios of about 1.5. How would you analyze Josh's liquidity relative to his friends?
Josh Smith has compiled some of his personal financial data in order to determine his liquidity position. The data are as follows: Account Ammount Cash 3,210 Marketable securities 960 Checking account 790 Credit card payables 1,150 Short-term notes payable 1,140 a. Calculate Josh's liquidity ratio. b. Several of Josh's friends have told him that they have liquidity ratios of about 1.5. How would you analyze Josh's liquidity relative to his friends?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Josh Smith has compiled some of his personal financial data in order to determine his liquidity position. The data are as follows:
| Account | Ammount |
| Cash | 3,210 |
| Marketable securities | 960 |
| Checking account | 790 |
| Credit card payables | 1,150 |
| Short-term notes payable | 1,140 |
a. Calculate Josh's liquidity ratio.
b. Several of Josh's friends have told him that they have liquidity ratios of about 1.5. How would you analyze Josh's liquidity relative to his friends?
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