Ask Question
16 August, 10:52

The financial statements for Silver Service Company include the following items: 2019 2018 Cash $50,500 $42,000 Short-term Investments 26,000 14,500 Net Accounts Receivable 52,000 48,000 Merchandise Inventory 131,000 51,000 Total Assets 532,000 548,000 Accounts Payable 132,500 127,000 Salaries Payable 16,000 16,000 Long-term Note Payable 57,000 57,000 Compute the acid-test ratio for 2018.

+2
Answers (1)
  1. 16 August, 11:12
    0
    0.73 times

    Explanation:

    The computation of the acid test ratio for 2018 is shown below:

    Acid-test ratio = Quick assets : total current liabilities

    where,

    Quick assets = Cash + short-term investments + Accounts receivable (net)

    = $42,000 + $14,500 + $48,000

    = $104,500

    And, the current liabilities would be

    = Accounts Payable + Salaries payable

    = $127,000 + $16,000

    = $143,000

    Now put these values to the above formula

    So, the value would equal to

    = $104,500 : $143,000

    = 0.73 times
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “The financial statements for Silver Service Company include the following items: 2019 2018 Cash $50,500 $42,000 Short-term Investments ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers