The Seabury Corporation Has a Current Ratio of 4

question 324

Multiple Choice

The Seabury Corporation has a current ratio of 4.2 and an acid-test ratio of 3.9. The corporation's current assets consist of cash, marketable securities, accounts receivable, and inventories. Inventory equals $18,000. Seabury Corporation's current liabilities must be: (Round your intermediate calculations to 1 decimal place.)

• A) $18,000
• B) $234,000
• C) $60,000
• D) $5,400

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Definitions:

Medical Expenses

Costs associated with the diagnosis, cure, mitigation, treatment, or prevention of disease, and expenses for treatments affecting any part of the body, potentially tax-deductible.

Deductible

An expense that can be subtracted from adjusted gross income to reduce taxable income, thereby lowering tax liability.

Investment Interest Expense

Interest paid on money borrowed to purchase or held for investment purposes, which can be deducted to reduce taxable income under certain conditions.

Net Investment Income

The income received from investment assets (like stocks and bonds) after expenses associated with making the investment are deducted.