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Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767 Exercise 46
Liquidity Analysis
The following selected information is taken from the financial statements of Arnn Company for its most recent year of operations:
During the year, Arnn had net sales of $2.45 million. The cost of goods sold was $1.3 million.
Required:
Note : Round all answers to two decimal places.
1. Compute the current ratio.
2. Compute the quick or acid-test ratio.
3. Compute the accounts receivable turnover ratio.
4. Compute the accounts receivable turnover in days.
5. Compute the inventory turnover ratio.
6. Compute the inventory turnover in days.
The following selected information is taken from the financial statements of Arnn Company for its most recent year of operations:
During the year, Arnn had net sales of $2.45 million. The cost of goods sold was $1.3 million.
Required:
Note : Round all answers to two decimal places.
1. Compute the current ratio.
2. Compute the quick or acid-test ratio.
3. Compute the accounts receivable turnover ratio.
4. Compute the accounts receivable turnover in days.
5. Compute the inventory turnover ratio.
6. Compute the inventory turnover in days.
Explanation
Verified
Verified
Calculate Current ratio: 
`
Note:
1) 2...
Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
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