The most recent balance sheet of Raconteurs, Inc., (in millions) is found here.Calculate Raconteurs’ current ration and acid-test (quick) ratio.Benchmark ratios for the current and acid-test (quick) ratio are 1.49 and 1.22 respectively. What can you say about the liquidity of Raconteur’s operations based on these two ratios? Current assetsCash and marketable securities$10.2Accounts receivable$40.8Inventory$60.8Total current assets$111.8Current liabilitiesAccrued wages and taxes$4.8Accounts payable$34.1Notes payable$30.3Total current liabilities$69.2(Click on the iconin order to copy its contents into a spreadsheet.)

Ratio analysis is a math tool that can help you learn more about a company's liquidity, efficiency,…

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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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The most recent balance sheet of Raconteurs, Inc., (in millions) is found here.
1. Calculate Raconteurs’ current ration and acid-test (quick) ratio.
2. Benchmark ratios for the current and acid-test (quick) ratio are 1.49 and 1.22 respectively. What can you say about the liquidity of Raconteur’s operations based on these two ratios?

Current assets
Cash and marketable securities
$10.2
Accounts receivable
$40.8
Inventory
$60.8
Total current assets
$111.8
Current liabilities
Accrued wages and taxes
$4.8
Accounts payable
$34.1
Notes payable
$30.3
Total current liabilities
$69.2
(Click on the icon
in order to copy its contents into a spreadsheet.)

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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