Which of the Following Is Included in the Denominator of the Acid-Test

question 96

Multiple Choice

Which of the following is included in the denominator of the acid-test ratio?

• A) All current liabilities except accounts payable
• B) Total liabilities
• C) Total current liabilities
• D) Total current assets

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Definitions:

Method of Elimination

A technique in algebra for solving a system of equations by removing variables to find their values.

System of Equations

A set of equations with the same variables, which are to be solved simultaneously.

Method of Substitution

A technique for solving systems of equations where one of the equations is solved for one variable in terms of the others, and then substituted into the other equation(s).

System of Equations

A set of equations with the same variables, which are solved together to find the values of these variables.