The Cowboy Shop has current liabilities of $151,200; cash in the amount $13,900; securities valued at $95,250; and accounts receivable of $157,300. Calculate the acid test ratio. (Round to the nearest hundredth)

Question

Quizplus · Accepted Answer

The acid test ratio is calculated as (Cash + Marketable Securities + Accounts Receivable) / Current Liabilities. Plugging in the given values: ($13,900 + $95,250 + $157,300) / $151,200 = $266,450 / $151,200 = 1.76:1.

The Cowboy Shop Has Current Liabilities of $151,200; Cash in the Amount