
College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Transcribed Image Text:The current ratio of a company is 6:1 and its acid-test ratio is 1:1. If the inventories
and prepaid items amount to $503,000, what is the amount of current liabilities?
Current Ratio:
The current ratio is the ratio of current assets to current liabilities, which is one of
the most widely used liquidity ratios. It helps the individual analyze the short-
term liquidity of the company.
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College Accounting, Chapters 1-27
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ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,