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Using Financial Statements for 2020, quick ratio for the year 2020 is 1.29. TRUE OR FALSE

Using Financial Statements for 2020, quick ratio for the year 2020 is 1.29. TRUE OR FALSE

Essentials Of Investments
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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Using Financial Statements for 2020, quick ratio for the year 2020 is 1.29.

TRUE OR FALSE 

Balance Sheet 2020 Income Statement 2020 Assets Sales $ 530,000 Cash $ 280,000 Cost of Goods Sold 148,400 Accounts Receivable 117,600 Gross Profit $ 381,600 Inventory 89,600 Interest Income 53,000 14,000 $ 501,200 Prepaid Expenses Total Income $ 434,600 Total Current Assets Sales Salaries 121,900 Fixed Assets 33,600 Office Salaries 26,500 Total Assets $ 534,800 Office Equipment Rental 37,100 Liabilities & Equity Interest Expense 15,900 Accounts Payable $ 90,916 General & Administrative 4,770 Notes Payable 48,132 Total Expenses 206,170 Accrued Expenses 42,784 Income Before Tax 228,430 Taxes Payable 37,436 Income Taxes 132,500 Deferred Taxes 48,132 Net Income $ 95,930 Total Current Liabilities $ 267,400 Long-Term Notes 123,004 Total Liabilities $ 390,404 Capital Stock 53,480 Retained Earnings 90,916 $ 144,396 $ 534,800 Total Equity Total Liabilities & Equity
Transcribed Image Text:Balance Sheet 2020 Income Statement 2020 Assets Sales $ 530,000 Cash $ 280,000 Cost of Goods Sold 148,400 Accounts Receivable 117,600 Gross Profit $ 381,600 Inventory 89,600 Interest Income 53,000 14,000 $ 501,200 Prepaid Expenses Total Income $ 434,600 Total Current Assets Sales Salaries 121,900 Fixed Assets 33,600 Office Salaries 26,500 Total Assets $ 534,800 Office Equipment Rental 37,100 Liabilities & Equity Interest Expense 15,900 Accounts Payable $ 90,916 General & Administrative 4,770 Notes Payable 48,132 Total Expenses 206,170 Accrued Expenses 42,784 Income Before Tax 228,430 Taxes Payable 37,436 Income Taxes 132,500 Deferred Taxes 48,132 Net Income $ 95,930 Total Current Liabilities $ 267,400 Long-Term Notes 123,004 Total Liabilities $ 390,404 Capital Stock 53,480 Retained Earnings 90,916 $ 144,396 $ 534,800 Total Equity Total Liabilities & Equity
Expert Solution
Step 1

Given:

Cash = $280,000

Accounts receivables = $117,600

Current liabilities = $267,400

 

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