O-LevelAccountingAnalysis and interpretation7707/12 · May/June 2020 · Q301 Mark

Sabelo's liquid (acid test) ratio was higher on 1 January 2019 than it was on 31 December 2019. What could have caused this?

Abank overdraft decreased

Binventory decreased

Cother payables decreased

Dtrade receivables decreased

✓ Correct answer

D: trade receivables decreased

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Topic: Analysis and interpretation, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, May/June 2020 Paper 1 Variant 2, question 30.

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