Suppose That a 4-Year-Old Boy Has Just Visited the Zoo

question 29

Multiple Choice

Suppose that a 4-year-old boy has just visited the zoo. He is describing what he saw, first to an adult, and then to his 2-year-old sister. You would expect to find that

• A) he uses the same kind of language for both people.
• B) he inappropriately uses more complicated language for his sister than for the adult.
• C) he uses more complicated language for the adult than for his sister.
• D) he would use more complicated language for the adult only if he is gifted in language skills.

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Definitions:

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Current Liabilities

Short-term financial obligations that are due to be paid within one fiscal year or the operating cycle, whichever is longer.

Non-current Liabilities

Non-current liabilities are obligations a company owes that are not expected to be paid within the next twelve months, including long-term loans, bond payables, and deferred tax liabilities.

Current Assets

Resources anticipated to be turned into cash, disposed of, or used up either within a year or over the course of the operating cycle, depending on which period extends further.