Current Ratio: Current Assets (including inventory) / Current Liabilities = 2.5
Current Assets (including inventory) / 500,000 = 2.5
Current Assets (including inventory) = 1,250,000
Quick Ratio (Acid Test): Current Assets (not including inventory) / Current Liabilities = 1.75
Current Assets (not including inventory) / 500,000 = 1.75
Current Assets (not including inventory) = 875,000
Inventory = Current Assets (including inventory) - Current Assets (not including inventory) = 1,250,000 - 875,000 = 375,000
Inventory Turnover: COGS / Inventory = 1
COGS / 375,000 = 1
COGS = 375,000
Therefore, 1) The inventory for the company is
375,000
2) The COGS is
375.000------------------------------
Martha Walker
Administrator
Colleyville, TX
United States
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Original Message:
Sent: 03-12-2020 07:04 PM
From: Nikunj Sheth
Subject: fill in the blanks
Fill in the blanks on the basis of detail follows
Current Ratio 2.5
Quick Ratio (Acid test ratio) 1.75
Current Liabilities $500,000
Inventory turn over 1
Find out (1) The inventory for the company is ______________
(2) The Cost of goods sold is ________________
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Nikunj Sheth
Controller
BRAMPTON ON
Canada
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