Which of the Following Statements Is Incorrect

question 7

Multiple Choice

Which of the following statements is incorrect?

• A) It is possible for a profitable company to go out of business because of short-term liquidity problems
• B) If a company has a current ratio greater than 2, it will never go out of business because of liquidity problems
• C) The current ratio is always greater than or equal to the quick ratio
• D) The accuracy of a cash flow forecast is inversely related to the forecast horizon.

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Definitions:

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The state of being subject to an action or influence, often used in legal contexts to describe a party affected by another's actions.

Different Format

A variation in the structure, layout, or presentation of content, distinguishing it from its original or conventional form.

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Official papers that express or record contractual agreements, rights, obligations, or judicial decisions.

Active Verbs

Words that express action and directly show what the subject of the sentence is doing.