Section 4. Liquidity Ratios Q24. Current ratio How is the current ratio calculated? A24. Current ratio = Current assets / Current liabilities [Entity 24-a] Current
Q25. Accounts payable On January 8, 20×1, Entity A paid $11,000 in cash to pay off the balance of its accounts payable to supplier M.
Q24. Goodwill Entity A acquired Entity S with the following information: (a) Fair value of the assets of Entity S = $900,000 (b) Fair value
Q23. Sale of equipment Entity A sold the following equipment. (a) Cost of equipment = $70,000 (b) Accumulated depreciation = $63,000 (c) Sale price of
Q23. Accounts payable turnover ratio How is the accounts payable turnover ratio calculated? A23. Accounts payable turnover ratio = Credit purchases / Average accounts payable
Q22. Accounts receivable turnover ratio How is the accounts receivable turnover ratio calculated? A22. Accounts receivable turnover ratio = Credit sales / Average accounts receivable