Question on: JAMB Accounting - 2015
Use the information below to answer this question.
(\begin{array}{c|c}
\text{Stock} & 11,250 \
\hline
\text{Debtors} & 18,750 \
\hline
\text{Creditors} & 3,750 \
\hline
\text{Bank} & 4,000 \
\hline
\text{Net profit} & 7,500 \
\hline
\text{Net} & 60,000 \
\end{array})
Calculate the acid test ratio
A
5 : 1
B
6 : 1
C
6 : 1 : 1
D
4 : 1
Ask EduPadi AI for a detailed answer
Correct Option: C
given that acid test ratio is:
(\frac {\text{Current assets – stock}}{\text{Current liabilities}})
Current assets:(\frac {\text{stock + Debtors + bank – stock}}{\text{Current liabilities}})
(\frac{11250 + 18750 + 4000 – 11250}{3750})
= 34000 – 11250 = 22750 = 6:1:1
Add your answer
Please share this, thanks!
No responses