Which of the Following Is Most Characteristic of the Quick

question 167

Multiple Choice

Which of the following is most characteristic of the quick ratio?

• A) It is generally larger than the current ratio.
• B) It decreases when a company's assets become more liquid.
• C) It increases when a company has more cash sales than credit sales.
• D) It is larger when a company's assets are more liquid.

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Definitions:

Other Income

Comprises earnings from sources other than the main business activities, such as interest, dividends, or rental income.

Accounts Payable

Money owed by a company to its creditors for goods and services purchased on credit.

Bank Reconciliation

The process of matching and comparing figures from the accounting records against those shown on a bank statement to ensure they align.

Balance Per Books

The ending balance on a company's financial records for a specific account, before any adjustments for reconciliation.