The following items are reported on a company's balance sheet: Cash $550,800 Marketable securities 430,300 Accounts receivable (net) 409,100 Inventory 331,000 Accounts payable 662,000 Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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I know in order to find the current ratio you divide your current assets by current liabilities.  I also know in order to find the Quick ratio you divide your quick assets by your current liabilities. But everytime I enter a number it says incorrect.

The following items are reported on a company's balance sheet:
Cash
$550,800
Marketable securities
430,300
Accounts receivable (net)
409,100
Inventory
331,000
Accounts payable
662,000
Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.
a. Current
ratio
b. Quick ratio
Transcribed Image Text:The following items are reported on a company's balance sheet: Cash $550,800 Marketable securities 430,300 Accounts receivable (net) 409,100 Inventory 331,000 Accounts payable 662,000 Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place. a. Current ratio b. Quick ratio
Expert Solution
Step 1

Ratio analysis helps to analyze the financial statements of the company. The management can take decisions on the basis of these ratios. It is also helpful to compare two or more financial statements.

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