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Working Capital and Liquidity (Word Scramble)

Author:
Harold Averkamp, CPA, MBA

To see each answer, press or click on the blue "Unscramble" button. If you have difficulty answering the following questions, learn more about this topic by reading our Working Capital and Liquidity (Explanation).

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

CURRENT NRUCETR
CURRENT RTNEUCR

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

LIQUIDITY DQIIYILUT
LIQUIDITY IDLTYQIUI

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.

CYCLE CLCYE
CYCLE CLCEY

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

RATIO OTAIR
RATIO RITAO

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

INVENTORY NRYVTIONE
INVENTORY IENNYROVT

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

QUICK QKIUC
QUICK IQCUK

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

DAYS ASDY
DAYS AYSD

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

COLLECTION NCLTECOILO
COLLECTION COOLLTNCEI

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

TURNOVER VNOERTUR
TURNOVER TERNUROV

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.

ESTIMATED EAITMSETD
ESTIMATED EDTIMETSA

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

AGING GINAG
AGING GGINA

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

AVERAGE AEGAERV
AVERAGE EVRGAAE

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

RECEIVABLE AEVEBLEICR
RECEIVABLE VBCLAEEEIR

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

ACCRUAL CCRAUAL
ACCRUAL CRLAAUC

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?

UNSECURED USNCDUEER
UNSECURED UNRECSEUD

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.

OPERATING PERINTGOA
OPERATING PARGNEIOT

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

PARENTHESES NTSEPREESHA
PARENTHESES ATREEPSENSH

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.

ELEVEN ELEVNE
ELEVEN EEENVL

19. Companies that purchase other companies' accounts receivable.

FACTORS OAFTRCS
FACTORS RCSFOAT

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 ______________.

LIABILITIES AILTELIISBI
LIABILITIES SIILEIITLBA
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About the Author

Harold Averkamp

For the past 52 years, Harold Averkamp (CPA, MBA) has
worked as an accounting supervisor, manager, consultant, university instructor, and innovator in teaching accounting online. He is the sole author of all the materials on AccountingCoach.com.

Learn More About Harold

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