How do you calculate quick ratio and current ratio?

How do you calculate quick ratio and current ratio?

How do you calculate quick ratio and current ratio?Porter, G., & Norton, C. (2018). Using financial accounting information: The alternative to debits and credits (10th ed.). Retrieved from https://www.cengage.com

  • Chapter 1: Accounting as a Form of Communication
  • Chapter 2: Financial Statements and the Annual Report

 

Prior to beginning work on this discussion forum, read Chapters 1 and 2 in your course textbook, Using Financial Accounting Information: The Alternative to Debits and Credits.

What is the formula of ratio?

 

Select a company of interest that trades on the New York Stock Exchange (NYSE). The annual report can be found on your selected company’s website, usually under the heading “Investor Relations.” Select a company that a fellow student has not already posted. Note that you will use this same company for future discussions in this class.

How Do the Current Ratio and Quick Ratio Differ?

 

Retrieve the latest two annual reports, then complete the following:

  • Calculate the current ratio and profit margin ratio for the latest two years, and interpret the results. Then, explain what the ratios over the 2 years tell you.
  • Locate the Management Discussion and Analysis comments in the latest annual report, and discuss the main points in your own words.
  • Locate the Auditor’s Report in the latest annual report, and discuss the opinion given and who conducted the audit.
  • Based on this initial quick review, provide your assessment of your chosen company.