KPR,Inc.has current assets of $10,000,000,current liabilities of $4,500,000,inventory of $1,000,000,and sales of $12,000,000.What is the acid test ratio?
A) 2.0
B) 1.67
C) 0.22
D) 0.1

Question

Quizplus · Accepted Answer

Acid test ratio = (Current assets - Inventory) / Current liabilities= ($10,000,000 - $1,000,000) / $4,500,000= $9,000,000 / $4,500,000= 2.0

KPR,IncHas Current Assets of $10,000,000,current Liabilities of $4,500,000,inventory of $1,000,000,and