Using the Following Year-End Information for Brim, LLC, Calculate the Current

question 26

Multiple Choice

Using the following year-end information for Brim, LLC, calculate the current ratio and acid-test ratio:

• A) 3.01 and 1.21
• B) 3.16 and .97
• C) 3.04 and 1.21
• D) 1.09 and 4.77
• E) None of these

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Definitions:

Automated Shaper

Machinery equipped with computer numerical control (CNC) to shape materials into specific designs with minimal human intervention.

Unused Capacity

Refers to the available production or service facility resources that are not currently being used.

Predetermined Overhead Rate

A rate used in cost accounting to allocate manufacturing overhead costs to products based on a planned level of activity or driver, such as machine hours or labor hours.

Machine-Hours

A measure of production volume or activity based on the number of hours machines are in operation.