Galaxy United, Inc. 2009 Income Statement in millions) $8,500 Net sales 7230 Les

Question

Galaxy United, Inc. 2009 Income Statement in millions) $8,500 Net sales 7230 Less: Cost of goods sold 420 Less: Depreciation Earnings before interest and taxes 850 Less: Interest paid Taxable Income Less: Taxes 270 502 Net income Galaxy United, Inc. 2008 and 2009 Balance Sheets in millions) 2008 2009 130 140 Accounts payable Cash Accounts rec. 950 780 Long-term debt 1,470 1,520 Inventory Common stock $2,550 $2,440 Sub-total Retained earnings Net fixed assets 3170 3,630 $5,720 $6,070 Total assets Total liab. & equity What is the quick ratio for 2009? O .97 O 2.16 O 2.30 O 1.35 O 81 2008 2009 $1.110 $1.130 930 1,259 $3180 $2,980 500 701 $5,720 $6,070

Explanation / Answer

Quick ratio measures the luquidity of firm, i.e how easliy the firm can meet its short term liabilities with help of its liquid assets.

Quick ratio = Cash+Account receivables / Current liabilities

=(140+780)/1130 =0.81

Answer is 0.81

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.