Which of the Following Statement Is Correct Regarding the Quick

question 16

Multiple Choice

Which of the following statement is correct regarding the quick ratio?

• A)The numerator for the quick ratio is current assets minus inventory minus accounts receivable.
• B)The numerator for the quick ratio is current assets.
• C)The quick ratio is also called the working capital ratio.
• D)The quick ratio is a more conservative variation of the current ratio.

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Definitions:

Functional Currency

The currency of the primary economic environment in which an entity operates, usually determining how financial statements are presented.

Presentation Currency

The currency in which a company's financial statements are reported, chosen by the company to suit its primary audience's needs.

Recorded

The process of formally documenting transactions and events in the financial records of an entity.

Functional Currency

The currency of the primary economic environment in which an entity operates, used in its financial reporting.