Given below is information for Xu Corporation and Yang Computers, Inc. at the end of 2016.
1 Using the information provided above, compute the following for each company at December 31, 2016:
A. Current ratio
B. Acid-test ratio
2 Comment briefly on the liquidity of each of these two companies. Which appears to be more liquid?
3 What other ratios would help you to more fully assess the liquidity of these companies?
Definitions:
Alternative Hypothesis
In hypothesis testing, it is the hypothesis that suggests there is a statistically significant effect or difference between groups or variables, as opposed to the null hypothesis.
Null Hypothesis
A statistical hypothesis that assumes no significant difference or effect, serving as the default assumption to be tested against an alternative hypothesis.
Null Hypothesis
A default hypothesis that there is no effect or no difference, and it is the hypothesis that researchers aim to test against.
Equals Sign
A symbol denoting mathematical equality between two expressions.
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