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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 RTUNCRE
CURRENT RREUNTC

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

LIQUIDITY YIDTUQIIL
LIQUIDITY LUIQYIDIT

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 ECCYL
CYCLE CCLYE

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

RATIO TROIA
RATIO OATIR

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

INVENTORY YONRTEVIN
INVENTORY ITVEORYNN

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

QUICK QKUIC
QUICK IQUKC

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

DAYS SDYA
DAYS SDYA

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

COLLECTION LLCCIETONO
COLLECTION COOEITLLCN

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

TURNOVER TURNOEVR
TURNOVER OEVTRNRU

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 ESMTIEDTA
ESTIMATED DTEIATMES

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

AGING NGGAI
AGING NGGIA

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

AVERAGE VGAEERA
AVERAGE EAEARGV

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

RECEIVABLE EIRBELECAV
RECEIVABLE BILEREVEAC

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

ACCRUAL AARCCUL
ACCRUAL RCUAALC

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 SREUUCNDE
UNSECURED UNUCDERES

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 PONGTAERI
OPERATING RTIAPOGEN

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

PARENTHESES AERHNPSSTEE
PARENTHESES TEHAPSEENRS

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 VNEELE
ELEVEN NVLEEE

19. Companies that purchase other companies' accounts receivable.

FACTORS ARSTCFO
FACTORS COATSRF

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 IILIILTABSE
LIABILITIES ISABIIILELT
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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.

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