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QLDAccountingQuick questions
Unit 4: Monitoring a business (company accounting and analysis)
Quick questions on Liquidity and efficiency ratios in QCE Accounting Unit 4
4short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.
What is current ratio?Show answer
Current ratio = Current assets / Current liabilities
What is quick (acid-test) ratio?Show answer
Quick ratio = (Current assets - Inventory - Prepaid expenses) / Current liabilities
What is inventory turnover?Show answer
Inventory turnover = Cost of goods sold / Average inventory
What is accounts receivable turnover?Show answer
Accounts receivable turnover = Net credit sales / Average accounts receivable
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