The Acid-Test (Quick) Ratio

question 220

Multiple Choice

The acid-test (quick) ratio

• A) is used to quickly determine a company's solvency and long-term debt paying ability.
• B) relates cash, short-term investments, and net receivables to current liabilities.
• C) is calculated by taking one item from the income statement and one item from the statement of financial position.
• D) is the same as the current ratio except it is rounded to the nearest whole percent.

---

Definitions:

Marketing Goals

Specific objectives that a business aims to achieve through its marketing efforts, such as increasing brand awareness or sales.

Skimming Pricing

A pricing strategy involving setting high prices initially and then gradually lowering them over time.

High Initial Price

A pricing strategy where a new product is introduced to the market at a high price point to recuperate development costs and target early adopters.

3M

3M is a multinational conglomerate corporation known for its research and development of thousands of products, including adhesives, abrasives, laminates, passive fire protection, and personal protective equipment.