Financial Reporting and Analysis Q192
192The following table shows the balance sheet extract for Pulpy Peaches Ltd.
| CurrentAssets | CurrentLiabilities | ||
| Cash | $75,000 | Accounts payables | $65,000 |
| Marketable securities | $60,000 | Short term notes payable | $80,000 |
| Accounts receivables | $56,000 | ||
| Inventory | $40,000 |
What is the cash ratio for the company?
- Option : B
- Explanation : Cash Ratio = (Cash + Marketable securities) / Current liabilities = (75,000 + 60,000) / (65,000 + 80,000) = 0.93
