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Zinaida [17]
2 years ago
10

Dennisport Corporation has an acid-test ratio of 1.7. It has current liabilities of $56,000 and noncurrent assets of $87,000. Th

e corporation's current assets consist of cash, marketable securities, accounts receivable, prepaid expenses, and inventory. Of Dennis Port current ratio is 2.3, its inventory and prepaid expenses must be:
Business
1 answer:
ra1l [238]2 years ago
3 0

Answer: $33600

Explanation:

Current liabilities = $56,000

Noncurrent assets = $87,000

First and foremost, we should note that:

Acid-test ratio = Current Assets / Current liabilities

Therefore,

1.7 = Current Assets / $56,000

Current assets = $56000 × 1.7

= $95,200

Also,

Current ratio = Current Assets / Current liabilities

Therefore,

2.3 = Current Assets / $56,000

Current assets = $56,000 × 2.3

= $128,800

Then, the inventory and prepaid expenses will be:

= $128,800 - $95,200

= $33,600

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