A Firm's Current Ratio Is Above the Industry Average; However

question 41

Multiple Choice

A firm's current ratio is above the industry average; however, the firm's quick ratio is below the industry average.These ratios suggest that the firm

• A)has relatively more total current assets and even more inventory than other firms in the industry.
• B)is very efficient at managing inventories.
• C)has liquidity that is superior to the average firm in the industry.
• D)is near technical insolvency.

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