question archive If Current Ratio is 1
If Current Ratio is 1
Subject:FinancePrice:2.86 Bought13
If Current Ratio is 1.3 and Quick Ratio is 0.9; then the value of inventory is……? The ending balance of current liabilities as disclosed in the balance sheet for XC ltd. is 100.000 USD.
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- Current ratio = Current Assets/Current Liabilities
1.3 = Current Assets/$100,000
Current Assets = $130,000
- Quick ratio = (Current Assets - Inventory)/Current Liabilities
0.9 = ($130,000 - Inventory)/$100,000
$90,000 = $130,000 - Inventory
Inventory = $40,000
