Question

With cash = $2950 and accounts payable at $11,900, what's the cash ratio?

Answer 1

`"Cash ratio"=2950/11900~=24.8%`

Explanation:

This is an accounting question - not sure where it should go, so I'll keep it here in Stats.

The cash ratio is the ratio of cash to current liabilities (we're in essence seeing how many times we can pay current liabilities with the cash on hand). We have:

`"Cash" = 2950`
`"A/P"=11900`

and so:

`"Cash ratio"=2950/11900~=24.8%`