3.5.3—Liquidity ratios Topic Practice
3.5.3—Liquidity ratios Topic Practice
Students practise calculating current and acid test ratios from balance sheet data—and interpreting liquidity health relative to industry norms or trends.
How this is tested
- calculate current ratio using cash, debtors and stock divided by current liabilities from case financials
- calculate acid test ratio by subtracting stock from current assets before dividing by current liabilities