Working Capital and Liquidity (Word Scramble)

1. Working capital is calculated using this category or classification of assets and liabilities.

2. The word pertaining to a company's ability to pay its obligations when due.

3. An asset is classified as current if it is expected to turn to cash within one year or within the operating _________, whichever is longer.

4. The total amount of current assets divided by the total amount of current liabilities is the current ___________.

5. A retailer's current asset that is not included in the calculation of its quick ratio.

6. Another name for the acid test ratio is the _________ ratio.

7. The cost of goods sold is more logical than using sales when computing a company's ______ sales in inventory.

8. A company's average ____________ period is calculated by dividing 360 or 365 days by its receivable turnover ratio.

9. A company's cost of goods sold divided by its average inventory is its inventory _____________ ratio.

10. When a company's balance sheet reports account receivable – net, it means that the amount is after a deduction for an _____________ amount of uncollectible or doubtful accounts.

11. A company's _______ of accounts receivable sorts the customers' open balances according to the date when the money should be collected.

12. The calculation of the inventory turnover ratio is more accurate when the amount of inventory is the ____________ amount during the entire year.

13. A company's operating cycle is the total of the days' sales in inventory and the days' sales in accounts _______________.

14. Accounts receivable and accounts payable will appear on the balance sheet of a corporation using this accounting method (or basis) of accounting.

15. Company A purchased goods on account (on credit) from Company B. Until the amount is paid, Company B has what type of claim against Company A?

16. The changes in most of the working capital accounts will appear on the statement of cash flows in the section entitled cash flows from ______________ activities.

17. If inventory increases during the accounting period, the amount of the change will appear on the statement of cash flows in _________________ .

18. A company had net credit sales of $440,000 in the past year. During the year it had an average accounts receivable balance of $40,000. Its receivables turnover ratio was ______________ times.

19. Companies that purchase other companies' accounts receivable.

20. The operating cash flow ratio is calculated by dividing a company's net cash provided by operating activities by the average amount of current ______________.