Chua Company Has Current Liabilities Totaling $1,500,000 and the Following

question 46

Multiple Choice

Chua Company has current liabilities totaling $1,500,000 and the following assets on December 31 of the current year: $\begin{array}{lr}\text { Cash } & \$ 300,000 \\\text { Accounts receivable, net } & 600,000 \\\text { Inventory } & 960,000 \\\text { Prepaid expenses } & 25,000 \\\text { Equipment, net } & 2,200,000 \\ \text { Total assets } & \$ 4,085,000 \\\end{array}$ How much is the company's acid-test ratio on December 31?

• A)0.20
• B)0.60
• C)1.26
• D)1.24

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Definitions:

Gross Domestic Product

The total value of all goods and services produced within a country over a specific time period.

Human Development Index

A composite statistic of life expectancy, education, and per capita income indicators, which are used to rank countries into four tiers of human development.

Carrying Capacity

The largest number of individuals of a species that can be supported indefinitely by an environment, considering the availability of essential resources such as food, living space, water, and other requirements.

Unlimited Economic Growth

The concept that an economy can grow indefinitely without encountering significant environmental or resource limitations.