Multiple Choice
Why might a firm use the quick ratio instead of the current ratio in its liquidity analysis?
A) It wants to target long-term debt instead of short term debt.
B) Its accounts receivable are greater than its cash.
C) Its inventory is not very liquid.
D) It considers the cash flow amount in the quick ratio more important than the other liquidity ratios.
E) Its notes receivable are greater than its cash.
Correct Answer:
Verified
Correct Answer:
Verified
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