A company has $25 million in cash, $85 million in accounts
receivables, $200 million in average inventory over the past
several years, and other assets of $83 million. Current liabilities
are $120 million, and stockholders' equity is $65 million. This
year, the company booked $250 million in sales. From a fundamental
analysis perspective, which of the following statements are true?
Group of answer choices According to the Acid Test, the company
should be able to meet its liabilities over the next year without
any difficulty. The company's inventory turns over at least 1 time
per year. The company generates $1.30 in sales for every dollar
invested in plant and equipment. Debt is used to finance 35% of the
firm's assets The company has $1.50 of assets for every $1 of
liabilities that it must discharge within the next year.
A company has $25 million in cash, $85 million in accounts receivables, $200 million in average inventory over the past
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