00:01
Okay, so first thing we want to do is calculate the current ratio.
00:04
So that's going to be current assets.
00:09
Okay.
00:10
All right, so we need to have our current assets.
00:17
Oops, spell that wrong.
00:19
Okay, current assets.
00:23
And that's going to equal to our cash 250 plus short -term investments, which is 200, plus accounts received below, which is 250.
00:35
Plus inventory, which is 350.
00:39
So that comes out to 1 ,050.
00:42
Now we need current liabilities, and that's going to equal to just 4.
00:51
Yeah, 450.
00:55
So that means our current ratio is going to be 1 ,050 over 450, which comes out to about 2 .33.
01:07
Okay? all right.
01:09
So then we want the asset test, calculate the asset test ratio.
01:19
Okay.
01:20
So that we're going to do is we need quick assets, which is going to be the cash, $250 plus short -term investments, $200, plus accounts receivable, which is $250, and that gives us $700.
01:39
So then we're going to take that divided by current liabilities so that the asset test ratio...