Before writing-off the uncollectible account of Sears, KMart had current assets of $150,000 and current liabilities of $100,000. After the company writes-off Sears' account receivable of $5,000, what will be its current ratio? KMart uses the allowance method to account for bad debts. a) 1.58 b) 1.55 c) 1.50 d) 1.45
Would the answer be d (145,000/100,000)?
- posted 11 years ago