The Quick Ratio Differs from the Current Ratio in That

Multiple Choice

The quick ratio differs from the current ratio in that it

A) represents the amount of cash on hand instead of the amount of working capital.
B) is a stricter test of a company's ability to pay its current debts as they are due.
C) excludes inventories and accounts receivable from the numerator of the fraction because of obsolescence and possible default on payment.
D) is more difficult to calculate.