A Company Should Maintain a Current Ratio of Two to One

question 72

Multiple Choice

A company should maintain a current ratio of two to one when:

• A) Inventory turns over frequently.
• B) The company has little inventory.
• C) The company grants little or no credit.
• D) The company is selling low priced clothing.
• E) Estimating customer demand is difficult.

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Definitions:

Actin

A protein that forms the thin filaments in muscle cells and is involved in motion and structure in other cell types.

Pediculosis

An infestation of lice on the human body, characterized by itching and sometimes redness and infection.

Subcutaneous

Referring to something situated or applied under the skin.

Alopecia

A medical condition causing hair to fall out in small patches, which can lead to total hair loss.