Question

26. MC.09-047

A company has $200 in cash, $500 in accounts receivable, and $700 in inventory. If current liabilities are $400, then the current ratio would be

a.2.25 to 1.

b.3.50 to 1.

c.3.00 to 1.

d.1.75 to 1.

27. MC.09-048

A company has $200 in cash, $500 in accounts receivable, and $700 in inventory. If current liabilities are $400, then the quick ratio would be

a.3.50 to 1.

b.1.75 to 1.

c.3.00 to 1.

d.2.25 to 1.

28. MC.09-050

Long-term assets are $800, current liabilities are $500, and long-term liabilities are $600. If the current ratio is 2.5 to 1, then current assets are

a.$1,250.

b.$200.

c.$625.

d.$2,000.

29. MC.09-051

If a company purchases $3,200 worth of inventory with terms of 3/10, n/30 on March 3 and pays March 12, then the amount paid to the seller would be

a.$3,200.

b.$3,104.

c.$96.

d.None of these choices are correct.

30. MC.09-054

If a company borrows money from its bank and the bank deducts the interest in advance, the company would record the amount of the interest deduction as

a.an expense.

b.a loss.

c.prepaid interest.

d.a discount.

Answer 1