Tuesday, July 19, 2011

Accounting Question Ratios?

I don't know which ones you are have trouble with, but many of the mistakes calculating ratios are caused by the amounts used for receivables and inventories. When calculating a ratio that calls for one of these amounts, you should always use the average balance. So your inventory average is (68,370 + 54,350) / 2 = 61,360 and your Receivables average is (68,030 + 62,770) / 2 = 65,400. If your still having problems, email me through my profile with your calculations and I'll look them over.

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