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Total current assests(CA)\$20,000
Accounts receivable(AR) \$10,000
Current Liabilities(CL) \$11,000
Inventory(INV) \$4,000
Net sales \$30,000
Total assests \$25,000
Net income \$5,000

1. Calculate current ratio.

A. 1.82
B. 1.80
C. 1.28
D .182

2.Calculate acid test.
A. 1.52
B. 1.45
C. .152
D. .145

• Business And Finance Mathematics -

i) As per the rule CR=CA/CL
=\$20,000/\$11,000=1.818181818181818 = Can round it to 1.82 (A)

ii) Current Acid or Quick Ratio= Quick Assets/CL

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