Page 58 - A Level Business Studies - Financial Analysis Tasks
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Task 3.b
Look at the extract of the Statement of Financial Position and answer the questions below
Statement of Financial Position - Example (Extract)
£ £
CURRENT ASSETS
Inventory (Stock) 4,000
Trade Receivables (Debtors) 6,400
Cash & Cash Equivalents (Cash & Bank) 1,600
12,000
Less CURRENT LIABILITIES
Trade Payables (Creditors) 5,000
VAT due to HRMC 1,000 6,000
Net Current Assets 6,000
1 Calculate the Current Ratio?
2 How does the "Acid Test" Ratio differ from the "Current Ratio"?
3 Why might the "Acid Test" ratio be deemed more appropriate than the "Current Ratio"
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