Asked by Ashley Louise on Jun 20, 2024
Verified
The Moose Hardware Company had cash of $160,000; current receivables of $136,000; and current liabilities of $63,000. Compute the acid test ratio.
Acid Test Ratio
A financial metric that measures a company's ability to pay off its short-term liabilities with its quick assets.
Current Liabilities
Short-term financial obligations that are due within a year or within the operating cycle.
- Evaluate the liquidity through the acid test ratio.
Verified Answer
OO
Learning Objectives
- Evaluate the liquidity through the acid test ratio.