The Quick Ratio Differs from the Current Ratio in That

question 46

Multiple Choice

The quick ratio differs from the current ratio in that it

• A)represents the amount of cash on hand instead of the total current assets.
• B)excludes inventories and accounts receivable from the numerator of the fraction because of obsolescence and possible collection problems.
• C)is a stricter measure of a company's ability to pay its current obligations.
• D)signals the need to liquidate short-term investments when it drops below 2.0.

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Definitions:

Subsequent Research

The additional studies or investigations conducted following initial research to explore or confirm findings.

Market Research

The process of gathering, analyzing, and interpreting information about a market, including details about target consumers and competitors, to inform business strategies.

Quantitative Data

Data that can be quantified and is typically structured in nature, usually represented in numbers and statistics for analysis.

Qualitative Data

Non-numerical information that describes qualities or characteristics, often gathered through interviews, observations, or surveys.