B$6$N$-69600-$MBA

Buiness finance $-$ Financial Ruthos

Why is the quick ratio a more appropriate measure of liquidty than the current ratio for a large$-$airplane manufacturer?

A $$ It recognizes the contribution of all avsets so that analysts can see how "culchty" a firm can satiafy ins short$-$term obligations.

B $$ It provides a better measure of overall liguldty when a firm has highly liquid imventory.

C $$ In is not more appropriate. The ourrent ratio would grovide better information in this situation.

D $$ to excludes imentory from the numerator of the ratio because it is difficult to convert inventory to cash and most sales are made on a credit bavis.