A-LevelAccountingAnalysis and communication of accounting information9706/12 · May/June 2010 · Q211 Mark

A business has trade payables (creditors) of $8000 and a bank overdraft of $2000. Its current ratio is 2:1 and its quick (acid test) ratio is 1.5:1. What is the value of its inventory (stock)?

A$4000

B$5000

C$28 000

D$35 000

✓ Correct answer

B: $5000

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Topic: Analysis and communication of accounting information, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, May/June 2010 Paper 1 Variant 2, question 21.

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