Last year, which is used as the base year, a firm had cash of $46, accounts receivable of $132, inventory of $319, and net fixed assets of $640. This year, the firm has cash of $52, accounts receivable of $147, inventory of $312, and net fixed assets of $576. What is the common-base year value of accounts receivable?
A) .88
B) .90
C) 1.11
D) 1.13
E) 1.18

Question

Quizplus · Accepted Answer

The common-base year value of accounts receivable is calculated by dividing the current year's accounts receivable by the base year's accounts receivable. In this case, the current year's accounts receivable is $147 and the base year's accounts receivable is $132. Therefore, the common-base year value of accounts receivable is $147/$132 = 1.11.

Last Year, Which Is Used as the Base Year, a Firm