Which of the Following Is True About Quick Ratio

question 112

Multiple Choice

Which of the following is true about quick ratio?

• A) It is computed as quick assets multiplied by current liabilities.
• B) It includes cash, inventory, and short-term investments.
• C) If it is less than 1.0, it raises liquidity concerns for creditors.
• D) It is a suitable measure to derive the profitability of the company.

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