Accounts and finance

Table of Contents

1. Topic pack - Accounts and finance - introduction
2. 3.1 Sources of finance - notes
3. 3.1 Sources of finance - questions
4. 3.2 Investment appraisal - notes
5. Investment appraisal
6. 3.2 Investment appraisal - questions
7. 3.3 Working capital - notes
8. 3.3 Working capital - questions
9. 3.4 Budgeting - notes (HL only)
10. 3.4 Budgeting - questions
11. 3.5 Final accounts - notes
12. 3.5 Final accounts - questions
13. 3.5 Final accounts - simulations and activities
14. 3.6 Ratio analysis - notes
15. 3.6 Ratio analysis - questions
    1. Profitability ratios - short answer questions
    2. Profitability ratios - memorandum
    3. Profitability - numerical questions
    4. Liquidity ratios - short answer questions
    5. Liquidity ratios - memorandum
    6. Liquidity ratios - numerical questions
    7. Efficiency ratios - short answer questions
    8. Financial efficiency ratios - numerical questions
    9. Gearing - short answer questions
    10. Gearing - numerical questions
    11. Shareholders' ratios - short answer questions
    12. Shareholder ratios - numerical questions
    13. Ratio analysis - limitations - report
    14. Ratio analysis - limitations
    15. Ratio analysis - summary questions
    16. Ratio analysis - case study - Stortford Yachts Limited
    17. Profiting from mobiles
16. 3.6 Ratio analysis - simulations and activities
17. Printable version

Liquidity ratios - short answer questions

Question 1

Explain why stock is not included as a current asset in the acid test ratio.

Question 2

Distinguish between the current ratio and the acid test ratio.

Question 3

Analyse methods by which a firm can improve its acid test ratio.

Question 4

Explain why a large cash holding in a company can be considered inadvisable and even potentially dangerous.