Examlex

Solved

For Each of the Following Ratios, Provide the Formula and State

question 24

Essay

For each of the following ratios, provide the formula and state what the ratio tells the financial statement user.
(a) acid-test ratio
(b) accounts receivable turnover ratio
(c) days' sales in receivables


Definitions:

FICA

The Federal Insurance Contributions Act, which is a U.S. law that requires a payroll deduction for Social Security and Medicare.

FUTA

Stands for the Federal Unemployment Tax Act, a United States federal law that imposes a payroll tax on businesses to fund state workforce agencies.

Unemployment Taxes

Taxes paid by employers on the wages of their employees, which fund unemployment compensation programs.

Form W-2

A financial document employed in the USA to record the earnings disbursed to workers and the deductions made for taxes.

Related Questions