quick ratio

fenil 13 April 2020 at 13:20 PM

A company’s quick ratio is 1.2. If inventory were purchased for cash, a) the quick ratio would remain the same since both accounts are current assets. b) the numerator and denominator of the quick ratio would decrease proportionally, leaving the ratio unchanged. c) the denominator of the quick ratio would decrease more than the numerator, resulting in a higher ratio. d) the numerator of the quick ratio would decrease while the denominator would be unchanged, resulting in a lower ratio.

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FACULTY 17 May 2020 at 01:32 PM

the numerator of the quick ratio would decrease while the denominator would be unchanged, resulting in a lower ratio.(option D)

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