The financial statements for Stephens' Electric Company include the following items:

Compute the 2016 cash ratio.(Round your answer to two decimal places. )
A)1.31
B)1.05
C)1.94
D)0.61

Question

The financial statements for Stephens' Electric Company include the following items:

Compute the 2016 cash ratio.(Round your answer to two decimal places. )
A)1.31 
B)1.05 
C)1.94 
D)0.61

Quizplus · Accepted Answer

A)Cash ratio = (Cash + Cash equivalents)/ Total current liabilities
Cash ratio = ($53,000 + $15,000)/ ($35,000 + $17,000)
Cash ratio = $68,000 / $52,000
Cash ratio = 1.31

The Financial Statements for Stephens' Electric Company Include the Following