You are calculating the quick ratio for the General Fund. The General Fund balance sheet contains the following captions: (1) cash; (2) cash equivalents; (3) taxes receivable; (4) inventory; (5) prepaid items; and (6) due from other funds.
Which of these accounts will enter into the calculation?
a. (1) and (2)
b. (1), (2), and (3)
c. (1), (2), (3), and (6)
d. all six
Question 2
An account used with a related account to bring about a decrease in the net amount of the two account balances is called a(n)
a. contra-account.
b. expense account.
c. adjusting account.
d. revenue account.