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ACC - Liquidity ratios. Edison, Stagg, and Thornton

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Question;1. Liquidity ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:Edison Stagg ThorntonCash $6,000 $5,000 $4,000Short-term investments 3,000 2,500 2,000Accounts receivable 2,000 2,500 3,000Inventory 1,000 2,500 4,000Prepaid expenses 800 800 800Accounts payable 200 200 200Notes payable: short-term 3,100 3,100 3,100Accrued payables 300 300 300Long-term liabilities 3,800 3,800 3,800a. Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

 

Paper#41186 | Written in 18-Jul-2015

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