A Firm's Current Ratio Is 1

question 37

Multiple Choice

A firm's current ratio is 1.5 and its quick ratio is 1.0. If its current liabilities are $10,000, what are its inventories?

• A) $ 5,000
• B) $10,000
• C) $15,000
• D) $20,000

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Definitions:

Net Requirements

The total amount of a product needed, considering the current inventory and scheduled production.

Gross Requirements

A recalculated total demand for an item, considering all demands without adjustments for existing inventory levels or incoming supplies.

MRP Tables

Tables used in Material Requirements Planning, showcasing schedules for when materials are needed in the manufacturing process to meet production goals.

Bill of Material

An exhaustive inventory of all raw materials, parts, and assemblies required to produce or mend a product or service.