While checking the Liquidity of company Z for the last 3 years 2018, 2019 and 2020 you

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While checking the Liquidity of company Z for the last 3 years 2018, 2019 and 2020 you noticed the followings:

1.The current ratio was decreasing while the quick ratio was increasing over time.

2.The ROE ratio (Net Income/Average total Equity) materially increased although the sales and the net income margin was almost the same.

As a financial analyst kindly explain the above two issues.

Posted Date: May 15, 2024 12:42 PM

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While checking the Liquidity of company Z for the last 3 years 2018, 2019 and 2020 you

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Answer The changes in the liquidity and profitability ratios of company Z over the last three years ... View the full answer

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