Accounting 9706 · AS & A Level · Analysis and communication of accounting information

Analysis and communication of accounting information — practice question

At the close of its financial year, the following details were available for a business. inventory $20000$ bank $8400$ credit trade receivables $35000$ trade payables $15000$ rent receivable in arrears $3000$ The business also had a 5-year bank loan of $20000$ to be repaid in equal annual instalments. What was the value of the current ratio?

  • A$2.12:1$
  • B$2.88:1$
  • C$3.52:1$
  • D$4.43:1$

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