Accounting 0452 · IGCSE · Calculation and understanding of accounting ratios

Calculation and understanding of accounting ratios — practice question

George gave the information below. Non-current assets: $\$15\,000$ Inventory: $\$12\,000$ Trade receivables: $\$18\,000$ Trade payables: $\$8\,000$ His liquid (acid test) ratio came to $1.2 : 1$. What was the amount of his bank overdraft?

  • A$\$7\,000$
  • B$\$15\,000$
  • C$\$17\,000$
  • D$\$29\,500$

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