53 If Bulldogs' current liabilities are P1,300,000, the firm's *Bulldogs Inc. has the following current assets.CashP 250,000100,000800,0001,450,000P2,600,000Marketable securitiesAccounts receivableInventoriesTotal current assetsO Acid-test ratio will be constant if a payment of P100,000 cash is used to acquire inventory.O current ratio will remain constant if a payment of P100,000 cash is used to pay P100,000 of current liabilities.O current ratio will decline if a payment of P100,000 cash is used to pay P100,000 of current liabilities.O Acid-test ratio will decrease if a payment of P100,000 cash is used to acquire inventory.

Acid test ratio and current ratios are liquidity ratios. They are used to determine a company’s…

If Bulldogs' current liabilities are P1,300,000, the firm's * Bulldogs Inc. has the following current assets. Cash Marketable securities Accounts receivable P 250,000 100,000 800,000 Inventories 1,450,000

If Bulldogs' current liabilities are P1,300,000, the firm's * Bulldogs Inc. has the following current assets. Cash Marketable securities Accounts receivable P 250,000 100,000 800,000 Inventories 1,450,000

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 8P

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Concept explainers

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

If Bulldogs' current liabilities are P1,300,000, the firm's *
Bulldogs Inc. has the following current assets.
Cash
P 250,000
100,000
800,000
1,450,000
P2,600,000
Marketable securities
Accounts receivable
Inventories
Total current assets
O Acid-test ratio will be constant if a payment of P100,000 cash is used to acquire inventory.
O current ratio will remain constant if a payment of P100,000 cash is used to pay P100,000 of current liabilities.
O current ratio will decline if a payment of P100,000 cash is used to pay P100,000 of current liabilities.
O Acid-test ratio will decrease if a payment of P100,000 cash is used to acquire inventory.

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