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Calculating the Current Ratio and the Quick or Acid-Test Ratio Chen Company has current assets equal to $3500000 Of these $1000000 is cash $2000000 is accounts receivable

Calculating the Current Ratio and the Quick (or Acid-Test) Ratio Chen Company has current assets equal to $3,500,000. Of these, $1,000,000 is cash, $2,000,000 is accounts receivable, $400,000 is inventory, and the remainder is marketable securities. Current liabilities total $2,000,000.

Required:

1. Calculate the current ratio.

2. Calculate the quick ratio (acid-test ratio).

Jun 27 2020 View more View Less

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