ACCOUNTING TERMS - ACCOUNTING DICTIONARY - ACCOUNTING GLOSSARY
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CASH RATIO Definition
CASH RATIO is a refinement to the QUICK RATIO. It is the ratio of cash and marketable securities to current liabilities. The CASH RATIO indicates the extent to which liabilities could be liquidated immediately. Sometimes called LIQUIDITY RATIO.
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LEGALLY MANDATED is that which is required by law, e.g. the ratio of majority inhabitant vs. minority new-hire quotas in a legislated work environment.
DUAL PURPOSE TEST is when audit procedures are classified both as substantive tests and tests of controls. When an audit procedure provides both types of evidence it is a dual purpose test.