Question

KLM Corporation's quick assets are $6,123,000, its current assets are $13,440,000 and its current liabilities are $8,144,000. Its acid-test ratio equals:

Answer 1

the acid-test ratio is 0.75 times

Step-by-step explanation:

The computation of the acid-test ratio is shown below:

We know that

Acid-test ratio is

= Quick assets ÷ current liabilities

= $6,123,000 ÷ $8,144,000

= 0.75 times

Hence, the acid-test ratio is 0.75 times

basically we divided the quick assets from the current liabilities so that the acid-test ratio could come