Firms a and B Have the Same Current Ratio, 0

question 37

True/False

Firms A and B have the same current ratio, 0.75, the same amount of sales and cost of goods sold, and the same amount of current liabilities.However, Firm A has a higher inventory turnover ratio than B.Therefore, we can conclude that A's quick ratio must be smaller than B's.

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Definitions:

Free Association

A psychoanalytic technique in which a patient says whatever comes to mind for the purpose of revealing unconscious thoughts and feelings.

Aaron Beck

A psychiatrist known for pioneering cognitive therapy, which focuses on changing unhelpful cognitive distortions and behaviors.

Cognitive Therapy

A form of psychotherapy that emphasizes the identification and restructuring of distorted thought patterns.

Behavior Therapy

A type of psychotherapy that focuses on changing undesirable behaviors through conditioning and the application of learning principles.