Liquidity

Question 1

Days’ Sales in Receivables

Answer 1

Gross Sales/(Net Sales/365)

Question 2

A/R Turnover

Answer 2

Net Sales/Average Gross Receivables

Question 3

A/R Turnover in Days

Answer 3

Average Gross Receivables/(Net Sales/365)

Question 4

Days’ Sales in Inventory

Answer 4

Ending Inventory/(COGS/365)

Question 5

Inventory Turnover

Answer 5

COGS/Average Inventory

Question 6

Inventory Turnover in Days

Answer 6

Average Inventory/(COGS/365)

Question 7

Operating Cycle

Answer 7

(A/R Turnover in Days) + (Inventory Turnover in Days)

Question 8

Working Capital

Answer 8

Current Assets - Current Liabilities

Question 9

Current Ratio

Answer 9

Current Assets/Current Liabilities

Question 10

Acid Test Ratio

Answer 10

(Cash Equivalents + Marketable Securities + Net Receivables)/Current Liabilities

Question 11

Cash Ratio

Answer 11

(Cash Equivalents + Marketable Securities)/Current Liabilities

Question 12

Sales to Working Capital

Answer 12

Sales/Average Working Capital

Question 13

Operating Cash Flow/Current Maturities of Long-Term Debt and Current Notes Payable

Answer 13

Operating Cash Flow/Current Maturities of Long-Term Debt and Current Notes Payable