If a firm has a current ratio less than 2.0 and an acid-test ratio less than 1.0,
Question:
If a firm has a current ratio less than 2.0 and an acid-test ratio less than 1.0, will the company eventually go bankrupt and out of business? Explain your answer.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 85% (7 reviews)
Not necessarily The current ratio will provide insight into the firms solvency over the short term ...View the full answer
Answered By
Somshukla Chakraborty
I have a teaching experience of more than 4 years by now in diverse subjects like History,Geography,Political Science,Sociology,Business Enterprise,Economics,Environmental Management etc.I teach students from classes 9-12 and undergraduate students.I boards I handle are IB,IGCSE, state boards,ICSE, CBSE.I am passionate about teaching.Full satisfaction of the students is my main goal.
I have completed my graduation and master's in history from Jadavpur University Kolkata,India in 2012 and I have completed my B.Ed from the same University in 2013. I have taught in a reputed school of Kolkata (subjects-History,Geography,Civics,Political Science) from 2014-2016.I worked as a guest lecturer of history in a college of Kolkata for 2 years teaching students of 1st ,2nd and 3rd year. I taught Ancient and Modern Indian history there.I have taught in another school in Mohali,Punjab teaching students from classes 9-12.Presently I am working as an online tutor with concept tutors,Bangalore,India(Carve Niche Pvt.Ltd.) for the last 1year and also have been appointed as an online history tutor by Course Hero(California,U.S) and Vidyalai.com(Chennai,India).
4.00+
2+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Economics questions
-
If a firm has no mutually exclusive projects, only independent ones, and it also has both a constant required rate of return and projects with conventional cash flow patterns, then the NPV and IRR...
-
If a firm has zero debt in its capital structure, is that always an organizational strength? Why or why not?
-
If a firm has a fixed asset base, meaning that its depreciation and amortization for any year is positive, discuss the relation between its Accounting DOL and its Cash Flow DOL.
-
State with reasons, whether the following statements are true or false : (i) Overhauling expenses for the engine of motor car to get better fuel efficiency is revenue expenditure. (ii) Depreciation...
-
(a) Complete the table. (b) Use the table in part (a) to determine the interval in which the solution of the equation 3.2x 5.8 = 0 is located. Explain. (c) Complete the table. (d) Use the table in...
-
Suppose the yield on a 10-year T-bond is currently 5.05% and that on a 10-year Treasury Inflation Protected Security (TIPS) is 2.85%. Suppose further that the MRP on a 10-year T-bond is 0.90%, that...
-
What is service-oriented architecture? How does SOA help the flexibility of an information system?
-
Explain briefly, how each of the following transactions would affect a companys balance sheet a. Purchase of a new $80 million building, financed 40% with cash and 60% with a bank loan. b. Purchase...
-
What are the total industry costs of pollution control (i.e., for both firms combined) if a uniform emission standard is utilized to achieve an aggregate emission reduction of 6 tons? In other words,...
-
A and B live on adjacent plots of land. Each has two potential uses for their land, the present values of each of which depend on the use adopted by the other, as summarized in the table. All the...
-
What is the advantage of comparing financial statements across periods or against industry benchmarks rather than in looking at statements associated with a single date or period?
-
Calculate the equity of the Gravel Construction Company if it has $1 million worth of assets? Gravel has $127,000 in current liabilities and $210,000in long term liabilities.
-
Due to a tune-up, the efficiency of an automobile engine increases by 5.0%. For an input heat of 1300 J, how much more work does the engine produce after the tune-up than before?
-
Question: [20 Marks] Consider the following linear system 3x + 2y4z - w = -9 7x-3y5z + 2w = -6 x+y+z+w = 10 2xy + 5z - 3w = 3 a) Solve the system using Matlab/Octave rref, backslash, and the inverse...
-
A tensile test was carried out on a cylindrical test piece with a radius of 5 mm and a length of 90 mm. The results are shown in figure 2. Calculate the Young's modulus of the material. 160 Figure 2...
-
write a kotlin function to sort an array by following this pseudocode: pseudocode is generic language between english and code. it is not language specific - it can be applied to any programming...
-
The shape of demand curves firms face may change from one form of market structure to another. In addition, there are several factors that influence the nature of firms, including the level of...
-
Nancy is a California resident who is filing her taxes as a head of household. Her alternative minimum taxable ( ( AMT ) ) income for 2 0 2 2 2 0 2 2 is $ 1 7 9 , 0 0 0 . 1 7 9 , 0 0 0 . What is her...
-
The globalization of markets and the globalization of production means that a. people are no longer in control of their own lives. b. we are all connected by the Web. c. companies can take one...
-
A circular concrete shaft liner with Youngs modulus of 3.4 million psi, Poissons ratio of 0.25, unconfined compressive strength 3,500 psi and tensile strength 350 psi is loaded to the verge of...
-
What strategies emerged during the global financial crisis and subsequent economic downturn? Were they successful? What have we learned as a result about strategy?
-
Multiple Choice Questions 1. The term annual percentage rate is the same as: (a) Effective rate (b) Nominal rate (c) Annual percentage yield (d) All of the above 2. An interest rate is an effective...
-
Multiple Choice Questions 1. In solving uniform series problems, n in the standard factor notation equation is equal to the number of arrows (i.e., cash flows) in the original cash flow diagram when:...
-
The Carroltons are deliberating whether to purchase a house or continue to rent for the next 10 years. They are assured by both of their employers that no transfers to new locations will occur for at...
-
O O A Dundas Company's inventory records for its retail division show the following at May 31: (Click the icon to view the accounting records.) At May 31, 10 of these units are on hand. Dundas...
-
4. R got 35% hike in his salary and 20% incentive on sales. If R sold goods worth Rs. 850 last year and the salary was Rs 70, then how much more does he earn this year with sales of Rs.900?
-
Teachers salaries have not been increasing as fast as the pay in many other types of work. Explain why you think this might be true. use graph of the supply and demand for teacher's labor to help...
Study smarter with the SolutionInn App