Which of the following choices best describes reasonable conclusions an analyst might make about the companys liquidity?
Question:
Which of the following choices best describes reasonable conclusions an analyst might make about the company’s liquidity?
A. Comparing FY14 with FY10, the company’s liquidity improved, as indicated by an increase in its debt-to-assets ratio from 0.14 to 0.27.
B. Comparing FY14 with FY10, the company’s liquidity deteriorated, as indicated by a decrease in interest coverage from 10.6 to 8.4.
C. Comparing FY14 with FY10, the company’s liquidity improved, as indicated by an increase in its current ratio from 0.71 to 0.75.
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The answer is C Comparing FY14 with FY10 the companys liquidity improved as indicated by an increase ...View the full answer
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Jinah Patricia Padilla
Had an experience as an external auditor in Ernst & Young Philippines and currently a Corporate Accountant in a consultancy company providing manpower to a 5-star hotel in Makati, Philippines, Makati Diamond Residences
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Related Book For 
International Financial Statement Analysis CFA Institute Investment Series
ISBN: 9780470287668
1st Edition
Authors: Thomas R. Robinson, Hennie Van Greuning CFA, Elaine Henry, Michael A. Broihahn, Sir David Tweedie
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