Financial statements for Larkins Company appear below:

Dividends during Year 2 totaled $135 thousand, of which $12 thousand were preferred dividends. The market price of a share of common stock on December 31, Year 2 was $150.

-Lisa Inc.'s acid-test ratio at December 31, Year 2, was closest to:

Question

Financial statements for Larkins Company appear below:

Dividends during Year 2 totaled $135 thousand, of which $12 thousand were preferred dividends. The market price of a share of common stock on December 31, Year 2 was $150.

-Lisa Inc.'s acid-test ratio at December 31, Year 2, was closest to:

Quizplus · Accepted Answer

The acid-test ratio is calculated by dividing quick assets (cash, marketable securities, and receivables) by current liabilities. Without specific figures, the closest ratio is typically around 1.1 for many companies, indicating that Lisa Inc. likely has enough quick assets to cover its current liabilities.

Financial Statements for Larkins Company Appear Below