Data from Yochem Corporation's most recent balance sheet appear below: Cash$16,000 Marketable securities$24,000 Accounts receivable, net$39,000 Inventory$53,000 Prepaid expenses$11,000 Current liabilities$109,000 Required:Compute the company's acid-test (quick) ratio. Show your work!
What will be an ideal response?
Acid-test (quick) ratio = Quick assets* ÷ Current liabilities
= $79,000 ÷ $109,000 = 0.72
*Quick assets = Cash + Marketable securities + Accounts receivable + Short-term notes receivable
= $16,000 + $24,000 + $39,000 = $79,000
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