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Liquidity Ratios Ernie's Mufflers Has Current Liabilities of $45 Million

Question 53

Multiple Choice

Liquidity Ratios Ernie's Mufflers has current liabilities of $45 million.Cash makes up 5 percent of the current assets and accounts receivable makes up another 50 percent of current assets.Ernie's current ratio = 1.5 times.What is the value of inventory listed on the firm's balance sheet?


A) $13.75m
B) $20.25m
C) $30.375m
D) $33.75m

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