Explain why the quick ratio might be a better indicator of an entity's liquidity than the current

Question:

Explain why the quick ratio might be a better indicator of an entity's liquidity than the current ratio.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial Accounting A Critical Approach

ISBN: 978-1259066528

4th edition

Authors: John Friedlan

See More Books

Question Posted: Feb 26, 2015 12:06 PM

See More Questions

Explain why the quick ratio or acid-test ratio is a better measure of a firms liquidity than the current ratio.
The labor force participation rate is a better indicator of the economy than the unemployment rate. The latter excludes people who may want a job but have been discouraged by their lack of success...
Which is likely to be a better indicator of acidification stress on forest trees, a molar ratio of Ca/Al in leaf tissue less than 1.0 or a molar ratio of Ca/Mn less than 1.0 in the leaf tissue? Why?
Find the exact value of sin(x - y) if sin(x) = 3T 3T T
When setting prices, what is the difference between how you would take into account an incremental fixed cost and how you would take into account a fixed cost that is not incremental?
Visit Web sites of companies that manufacture telepresence products for the Internet. Prepare a report. Differentiate between telepresence products and videoconferencing products.
The Dallas Development Corporation is considering the purchase of an apartment project for $\$ 100,000$. They estimate that they will receive $\$ 15,000$ at the end of each year for the next 10...
A business executive says, The financial perspective of the balanced scorecard indicates how the organization adds value to shareholders. I am involved with two organizations: a small business that...
It may not have always worked out very well in practice, but theoretically it is possible to issue AAA rated bonds backed by a pool of sub-prime mortgages .Briefly describe how you would do this.Be...
Over 14 years, Casey has saved $7200 by authorizing $30 to be deducted at the end of every month through a payroll deduction plan at his work. The money was sent to his savings account to be...
Is it possible for an entity to be too liquid? Explain.
Describe a situation where a user of a private corporation's financial statements would be interested in segregating permanent and transitory earnings. Explain why the separation of the two types of...
Use the graph of f to determine whether each statement in Exercises 122125 is true or false. f (-1) - f (4) = 2 -5-4-3-2. 32 y 2 3 +2+ Graph of f H HTT HE X
1- Given a mold in spherical form, alumina slip will be poured by solid casting method in order to build cannon balls in classical style. The sphere diameter D = 20 cm. and the thickness increase...
You begin saving for your retirement by depositing $500 at the end of each month in an RRSP. As of the start of these regular payments, youve already saved $10,000. If the interest rate is 7.5%,...
In a PID process trainer experiment when we increase the proportional gain to 5 we obtained sustained oscillations, and the oscillation period was 2 seconds. What are the values of the 3 parameters...
A small apartment property is estimated to have potential gross income of $ 25,000. Vacancy and collection losses are expected to average 5 percent over the life of the property. Operating expenses...
does a company that issues preferred stock obligated to pay out a dividend, why or why not?
A utility has a department which does nothing but change the addresses of customers on the company's information systems when customers move house. The process is deemed to be in control at the...
1. What are some current issues facing Saudi Arabia? What is the climate for doing business in Saudi Arabia today? 2. Is it legal for Auger's firm to make a payment of $100,000 to help ensure this...
The GDP deflator in Econoland is 200 on January 1, 2014. The deflator rises to 242 by January 1, 2016, and to 266.2 by January 1, 2017. a. What is the annual rate of inflation over the two-year...
We have found our answer, activity-based costing it is, exclaimed Roger Lalonde, general manager of a multi-departmental medium-sized manufacturing company. Roger had recently attended a seminar...
In an exclusive august 2007 survey of 1,011 people aged 50 and over, AARP The Magazine sought to learn what older Americans think about life after death. They found that 73% agree with the statement...
1. Show how the IS curve and the LM curve can be shifted to get an increase in output without a change in interest rates. What kind of mix of monetary and fiscal policies is needed to do this? How...
In Unix and Linux systems, the configuration of the operating system, servers, applications and preferences is commonly stored in plain text files. You want to view the hardware attached to the...
An actual corporation reported this information on their 2019 Annual Report ($ millions). Inventory cost method of LIFO is used. Date Inventory Balance Cost of Goods Sold (COGS) December 31, 2018...
The markets in general are paying a 2% real rate of return. Inflation is expected to be 3%. ABC stock commands a 6% risk premium. What is the expected rate of return on ABC stock? The required rate...

Explain why the quick ratio might be a better indicator of an entity's liquidity than the current

Question:

Step by Step Answer:

The current ratio includes assets such as inventory or p...View the full answer

Financial Accounting A Critical Approach

Students also viewed these Managerial Accounting questions