Which of the Following Statement Is Correct Regarding the Quick

question 126

Multiple Choice

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

• A)The numerator for the quick ratio is current assets.
• B)The numerator for the quick ratio is current assets minus inventory minus-prepaid expenses.
• C)The quick ratio is also called the working capital ratio.
• D)The quick ratio is a less conservative variation of the current ratio.

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Definitions:

Unamortized Premium

The portion of the bond premium that has not yet been amortized or allocated as an expense over the bond's life.

Straight-Line Method

A depreciation method that allocates an equal portion of the initial cost of an asset to each accounting period over its useful life.

Amortization

The process of gradually writing off the initial cost of an asset over a period.

Bondholders

Investors or entities that hold debt securities, especially bonds, issued by corporations or governments, entitling them to interest payments and the return of principal.