Which of the Following Current Assets Is NOT Included When

question 105

Multiple Choice

Which of the following current assets is NOT included when calculating the acid-test ratio?

• A) Cash
• B) Marketable securities
• C) Inventory
• D) Accounts receivable

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Definitions:

Owner's Equity

The residual interest in the assets of a business after deducting its liabilities.

Total Liabilities

The sum of all financial obligations a company owes to outside parties, including loans, accounts payable, and mortgages.

Property Plant and Equipment

These are long-term tangible assets owned by a business, used in producing goods or services and not expected to be consumed or converted into cash within a year.

Accumulated Depreciation

The total amount of an asset's cost that has been expensed over its useful life, reflecting wear and tear or obsolescence.