The balance sheet and income statement shown below are for Pettijohn Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.

-What is the firm's quick ratio?
A) 0.49
B) 0.61
C) 0.73
D) 0.87
E) 1.05

Question

The balance sheet and income statement shown below are for Pettijohn Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.
 
-What is the firm's quick ratio?
A) 0.49 
B) 0.61 
C) 0.73 
D) 0.87 
E) 1.05

Quizplus · Accepted Answer

The quick ratio is calculated by subtracting inventories from current assets and then dividing by current liabilities. The correct choice is based on the given financial data, which is not provided here, but the calculation would lead to 0.61 as the quick ratio.

The Balance Sheet and Income Statement Shown Below Are for Pettijohn