Additional information: 1. As at 1 February 2021, current assets were P280,000, and current liabilities were P100,000. 2. As at 1 February 2021 current assets included P30,000 of merchandise inventory and P4,000 of prepaid expenses. REQUIRED: (a) Calculate the current ratio as of the beginning of the month and after each transaction. (b) Calculate the acid-test ratio as of the beginning of the month and after each transaction.

Additional information: 1. As at 1 February 2021, current assets were P280,000, and current liabilities were P100,000. 2. As at 1 February 2021 current assets included P30,000 of merchandise inventory and P4,000 of prepaid expenses. REQUIRED: (a) Calculate the current ratio as of the beginning of the month and after each transaction. (b) Calculate the acid-test ratio as of the beginning of the month and after each transaction.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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