Apex Corp Has Current Liabilities of $2 Million, a Current Ratio

question 27

Essay

Apex Corp. has current liabilities of $2 million, a current ratio of 3, a quick ratio of 2, and a cash ratio of .75. Given this information, answer the following about the firm's liquidity:
a. What is the value of inventory?
b. What is the value of receivables?
c. What will happen to each of the three ratios if $1 million in current liabilities is refunded with long-term debt?

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Definitions:

Primary Category

A primary category is the main or leading group or classification within a broader system or framework.

Geographic Location

The specific physical position of a person or thing, often described by coordinates of longitude and latitude, or a regional description.

Common Categories

Standard classifications or divisions into which objects, ideas, or information are grouped based on shared characteristics.

Diversity

Refers to the variety of differences among people in an organization, encompassing race, gender, ethnicity, age, sexuality, language, and cultural background.