61 agnes company reported the following data quick assets 55 000 current assets150 0 4314025

61 agnes company reported the following data quick assets 55 000 current assets150 0 4314025

61.Agnes Company reported the following data:

Quick assets$55,000

Current assets150,000

Total liabilities 300,000

Average net receivables12,600

Beginning inventory38,000

Long-term liabilities200,000

Net credit sales 126,000

Cost of goods sold84,000

Ending inventory46,000

What was the inventory turnover ratio? 

A. 2.2

B. 1.8

C. 2.0

D. 3.0

62.Agnes Company reported the following data:

Quick assets$55,000

Current assets150,000

Total liabilities 300,000

Average net receivables12,600

Beginning inventory38,000

Long-term liabilities200,000

Net credit sales 126,000

Cost of goods sold84,000

Ending inventory46,000

What was the average number of days to sell inventory? 

A. 165.9

B. 202.7

C. 182.5

D. 121.7

63.The operating cycle includes the number of days it takes to: 

A. Purchase goods, sell goods, pay cash to suppliers.

B. Purchase goods, pay cash, collect cash from customers.

C. Borrow money, collect cash from customers, repay cash borrowed.

D. Pay cash for goods, sell goods, collect cash from customers.

64.Which of the following is not a ratio included in analysis of the operating cycle? 

A. Days to collect receivables.

B. Days to buy inventory.

C. Days to pay payables.

D. Days sales in inventory.

65.Liquidity ratios concentrate on: 

A. The operating cycle.

B. Profitability.

C. Short-term financial strength.

D. Ability to pay interest on loans.

66.Baron Company reported the following data:

Cash$80,000

Accounts receivable120,000

Marketable securities 40,000

Inventory100,000

Prepaid rent expense10,000

Accounts payable70,000

Current portion of long-term debt 140,000

Net credit sales1,000,000

Cost of goods sold600,000

The current ratio is closest to: 

A. 5.0

B. 4.92

C. 4.86

D. 1.67

67.Baron Company reported the following data:

Cash$80,000

Accounts receivable120,000

Marketable securities 40,000

Inventory100,000

Prepaid rent expense10,000

Accounts payable70,000

Current portion of long-term debt 140,000

Net credit sales1,000,000

Cost of goods sold600,000

The quick ratio is closest to: 

A. 3.57

B. 1.67

C. 1.19

D. 1.14

68.Baron Company reported the following data:

Cash$80,000

Accounts receivable120,000

Marketable securities 40,000

Inventory100,000

Prepaid rent expense10,000

Accounts payable70,000

Current portion of long-term debt 140,000

Net credit sales1,000,000

Cost of goods sold600,000

The cash ratio is closest to: 

A. 1.14

B. 0.95

C. 0.38

D. 0.36

69.If the current ratio is 2, what will be the effect of the payment of a cash dividend, which was recorded as a liability on the date of declaration?

A. An increase in the current ratio.

B. A decrease in the current ratio.

C. No effect on the current ratio.

D. A decrease in the cash coverage ratio.

70.Which of the following transactions would increase the current ratio of a company if the ratio is currently greater than 1?

A. Paid the principal on a long-term note payable.

B. Borrowed cash on a short-term note.

C. Sold inventory for more than cost.

D. Purchased supplies with cash.

13-1

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