The Quick ratio is measured by (Cash + Receivables) / Current liabilities . Assume this ratio is

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The Quick ratio is measured by (Cash + Receivables) / Current liabilities.

Assume this ratio is currently 80% (or 0.8:1) and that the cash balance remains positive at all times.

State the effect the following event occurring on the reporting date would have on this ratio.

EVENT: A payment to settle an amount owing to a trade payable

No change

Descrease

Increase

Related Book For answer-question

Financial Accounting

ISBN: 978-0133052152

2nd edition

Authors: Robert Kemp, Jeffrey Waybright

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Posted Date: Nov 12, 2022 06:48 AM

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The Quick ratio is measured by (Cash + Receivables) / Current liabilities . Assume this ratio is

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ANSWER B Descrease Decrease means to lower or go down If you are driving above the speed limit you s... View the full answer

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