Option a. is correct answer.
Explanation:
Current ratio = current assets / current liabilities
2.15 = current assets / current liabilities
$1 current assets = $2.15 current liabilities
What does a current ratio of 2.15 indicate? Select one: a. It indicates that for every...
A total asset turnover ratio of 2.6 indicates that: Multiple Choice For every $1 in sales, the firm acquired $2.6 in assets during the period For every $1 in assets, the firm produced $2.6 in net sales during the period. For every $1 in assets, the firm earned gross profit of $2.6 during the period. For every $1 in assets, the firm earned $2.6 in net income For every $1 in assets, the firm paid $2.6 in expenses during the...
1-b. Based on the above calculation and analysis of TripAdvisor's current ratio 2.15, indicate which company is in a better position to pay liabilities. O Edward Allen O TripAdvisor PA2-3 Part 2 2. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Assets Liabilities Stockholders' Equity b. d . Edward Allen Interiors Inc. is a leading...
A total asset turnover ratio of 2.2 indicates that: Multiple Choice Ο For every $1 in assets, the firm earned $2.2 in net income. Ο For every $1 in assets, the firm paid $2.2 in expenses during the period. Ο O For every $1 in assets, the firm produced $2.2 in net sales during the period Multiple Choice For every $1 in assets, the firm earned $2.2 in net income. For every $1 in assets, the firm paid $2.2 in...
Indicate what is meant by the following ratio calculations. 1. Liquidity Ratios Current Ratio = Current Assets Current Liabilities = 515800 626900 = 0.82 : 1 Quick Ratio = Quick Assets Current Liabilities = 42700 + 205800 626900 = 0.40 Cash Ratio = Cash & Cash Equivalents Current Liabilities = 42700 626900 = 0.0681 : 1 2. Turnover / Activity Ratios Inventory Turnover = COGS Average Inventories...
Assume that a company has a current ratio of 1.5:1. This would imply: a. there is sufficient net income to pay Accounts Payable b. there is $1.50 of Cash for every $1 of Accounts Payable c. there is $1.50 of Current Assets for every $1 of Current Liabilities d. there is $1.50 of Cash for every $1 of Total Debt e. there is $1.50 of Cash for every $1 of Retained Earnings
Working Capital and Short-Term Liquidity Ratios Ritter Company has a current ratio of 3.00 on December 31. On that date the company's current assets are as follows: Cash$32,000Short-term investments49,300Accounts receivable (net)170,000Inventory200,000Prepaid expenses11,600Current assets$462,900Ritter Company's current liabilities at the beginning of the year were $150,000 and during the year its operating activities provided a cash flow of $60,000. a. What are the firm's current liabilities on December 31? b. What is the firm's working capital on December 31? c. What is the quick ratio on December...
Using the information below, what is the current ratio for Raynee? (current assets/current liabilities) The following information pertains to Raynee Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. Assets Cash and short-term investments 50,000 Accounts receivable (net) 39,000 Inventory 23,000 Property, plant, and equipment 308,000 Total assets 420,000 Liability and Stockholders’ Equity Current liabilities 75,000 Long-term liabilities 120,000 Stockholders’ equity – common 225,000 Total Liabilities and Stockholders’ Equity 420,000 Income Statement Sales 145,000 Cost of goods...
1. what is the current ratio and what does the final number specifically tell managers or investors? 2. what is the inventory turnover and what does the final number tell managers or investors? 3. what is the return on assets and what does the final number tell managers or investors? EXHIBIT 8.1 The Balance Sheet for Bigbux Bigbux, Inc. Balance Sheet December 31, 201X Assote (Resources owned by the trm) ASSETS Current Assets Cash $188.000 Accounts receivable 187,000 396.000 771,000...
1. Which one of the following actions will increase the current ratio, all else constant? Assume the current ratio is greater than 1.0. a. Cash purchase of inventory b. Cash payment of an account receivable C Cash payment of an account payable d. Cash sale of inventory at a loss 2. The Equity Multiplier is equal to: @ One plus the debt-equity ratio b. One plus the total asset turnover C. Total debt divided by total equity d. Total equity...
Which of the following statements is true? A. The use of the current ratio does not make it possible to compare companies of different sizes. B. A current ratio of 1.2 to 1 indicates that a company’s current assets are less than its current liabilities. C. All companies, regardless of size, should have a current ratio of at least 2:1. D. The current ratio is a more dependable indicator of liquidity than working capital.