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16 January, 05:18

Jen's has current assets of $2,200, cash of $400, and inventory of $1,300. The firm has accounts payable of $300, long-term debt of $3,100, and accrued wages and taxes of $400. What is the quick ratio?

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  1. 16 January, 05:40
    0
    1.29

    Step-by-step explanation:

    Data provided in the question:

    Current assets = $2,200

    cash = $400

    Inventory = $1,300

    Accounts payable = $300

    long-term debt = $3,100

    Accrued wages and taxes = $400

    Now,

    Quick ratio = [ Current assets - Inventory ] : [ Current liabilities ]

    also,

    Current liabilities = Accounts payable + Accrued wages and taxes

    = $300 + $400

    = $700

    or

    Quick ratio = [ $2,200 - $1,300 ] : $700

    or

    Quick ratio = $900 : $700

    = 1.29
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