A company has $24,000 in cash and cash equivalents, $88,000 in short-term investments, $128,000 in net current receivables, $57,000 in inventory, $15,000 of prepaid insurance and $10,000 of supplies. The total current liabilities of the firm are $303,000. The quick ratio of the company is: (Round your final answer to two decimal places.)

Question

Quizplus · Accepted Answer

The quick ratio is calculated as (Cash and Cash Equivalents + Short-term Investments + Net Current Receivables) / Current Liabilities. Here, it is ($24,000 + $88,000 + $128,000) / $303,000 = $240,000 / $303,000 = 0.79.

A Company Has $24,000 in Cash and Cash Equivalents, $88,000