A company has current liabilities of $2,000,000 and net working capital of $300,000. If the company has a quick ratio of 0.8, the company has inventory of
Question
Solution 1
The quick ratio is calculated as (Current Assets - Inventory) / Current Liabilities.
Given that the quick ratio is 0.8 and the current liabilities are $2,000,000, we can set up the following equation:
0.8 = (Current Assets - Inventory) / $2,000,000
Solving for Current Assets, we get:
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