Using the following year-end information for Brim,LLC,calculate the current ratio and acid-test ratio:

A)3.01 and 1.21
B)3.16 and .97
C)3.04 and 1.21
D)1.09 and 4.77
E)None of the answers are correct.

Question

Using the following year-end information for Brim,LLC,calculate the current ratio and acid-test ratio:

A)3.01 and 1.21 
B)3.16 and .97 
C)3.04 and 1.21 
D)1.09 and 4.77 
E)None of the answers are correct.

Quizplus · Accepted Answer

Current Ratio = Current Assets/Current Liabilities
Current Ratio = $342,500/$108,500 = 3.16
Acid-Test Ratio = Quick Assets/Current Liabilities
Acid-Test Ratio = $105,000/$108,500 = 0.97

Using the Following Year-End Information for Brim,LLC,calculate the Current Ratio