Solve for (A)current Ratio, (B)acid Test (Quick), (C)average Day's Collection

question 16

Short Answer

Solve for (A)current ratio, (B)acid test (quick), (C)average day's collection (360), (D)asset turnover, and (E)profit margin on sales. Round to nearest hundredth or hundredth percent as needed.
$$\begin{array} { | l | l | } \hline \text { Current Assets } & \$ 21,000 \\\hline \text { Accounts Receivable } & \$ 4,200 \\\hline \text { Current Liabilities } & \$ 16,000 \\\hline \text { Inventory } & \$ 3,500 \\\hline \text { Net Sales } & \$ 41,000 \\\hline \text { Total Assets } & \$ 32,000 \\\hline \text { Net Income } & \$ 6,000 \\\hline\end{array}$$

---

Definitions:

Valuation-relevant

Valuation-relevant refers to information or factors that can influence the assessment of an asset's or company's value during a valuation process.

Transitory Earnings Component

The part of earnings believed to be temporary or non-recurring and not indicative of the company's ongoing financial performance.

Permanent Earnings

The portion of a company's income considered to be sustainable and repeatable, excluding one-time events or accounting anomalies.

Continuing Operations

Parts of a business expected to continue operating and contributing to earnings over the long term, excluding any discontinued operations.