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The days sales in receivables ratio is computed as average net accounts receivable divided

The days sales in receivables ratio is computed as average net accounts receivable divided by 365 days.

12) The current ratio is calculated by taking the total of all current assets except inventory divided by the total of all current liabilities.

13) A decrease in the acid-test ratio from one year to the next indicates the company's liquidity position is likely improving.

14) An increase in the acid-test ratio from one year to the next indicates the company's liquidity position is likely improving.

15) The quick ratio helps investors measure the organization's liquidity.

16) The acid test ideal ratio is 2.0.

17) The acceptable acid-test ratio varies by industry.

Dec 09 2019 View more View Less

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