The current ratio should not be used as the only measure of liquidity, because it does not
Question:
"The current ratio should not be used as the only measure of liquidity, because it does not take into account the composition of the current assets." Explain what this statement means.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 69% (13 reviews)
Current assets include accounts receivable and inventory These may have increasing balance...View the full answer
Answered By
Muhammad Umair
I have done job as Embedded System Engineer for just four months but after it i have decided to open my own lab and to work on projects that i can launch my own product in market. I work on different softwares like Proteus, Mikroc to program Embedded Systems. My basic work is on Embedded Systems. I have skills in Autocad, Proteus, C++, C programming and i love to share these skills to other to enhance my knowledge too.
3.50+
1+ Reviews
10+ Question Solved
Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118644942
6th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
Question Posted:
Students also viewed these Accounting questions
-
Ian Stoddart was reviewing his companys 2013 year-end financial estimates, and he was not satisfied with the overall performance. He asked his management team to prepare their detailed operational...
-
Should Trade Restrictions Be Used to Influence Human Rights Issues? Point Yes. Some countries do not protect human rights in the same manner as the United States. At times, the United States should...
-
Various classification schemes are sometimes used to given an indication of the potential of a foreign market/country. Explain why these schemes should or should not be used as a basis for deciding...
-
STEELCO manufactures two types of steel (steel 1 and steel 2) at two locations (plant 1 and plant 2). Three resources are needed to manufacture a ton of steel: iron, coal, and blast furnace time. The...
-
The following partial list of accounts and account balances has been taken from the trial balance and the adjusted trial balance of the Barker Company: Required Prepare the adjusting entry that...
-
Consider the following statements regarding the choice of conjugate teeth for the profile of mating gears: 1). They will transmit the desired motion 2). They are difficult to manufacture 3)....
-
Do you fit within the profile or characteristics of a white collar criminal? Explain.
-
Elm Company had total assets of $640,000 in 2012, $680,000 in 2013, and $760,000 in 2014. In 2013, Elm had net income of $77,112 on revenues of $1,224,000. In 2014, it had net income of $98,952 on...
-
Assume the return on a market index represents the common factor and all stocks in the economy have a beta of 1. Firm-specific returns all have a standard deviation of 38%. Suppose an analyst studies...
-
Consider the following table and Progress Report to answer the questions given below: Activity Predecessor Time(days) Estimated Cost A None IS 90 B None 2 $120 A S 200 ID IC 1 IS 60 E C $100 Progress...
-
What are current assets? Give four examples of current assets a company might have.
-
Dong Corporation has a debt to total assets ratio of 45%, while its competitor, Du Ltd., has a debt to total assets ratio of 55%. Based on this information, which company is more solvent? Why?
-
Maximize f = 60x + 48y + 35z subject to 8 + + z < 108 4 + 2y + 1.5z < 50 2 + 1.5 + 0.5z 40 z < 16 x2 0, y 2 0, z20
-
How do the Big Five personality traits correlate with different life outcomes, such as career success, relationship satisfaction, and overall well-being ?
-
How can I describe the tables in the Northwind database, the primary and foreign key relationships which include cardinality? How can I describe the business processes that the online transaction...
-
Make a Range Control Chart. Labelling the X-axis "Sample Number" and the Y-axis "Sample Range". The data above is not meant to be divided up; it's one continuous string of data. Please show all...
-
How to do mass balance if crude A = 15, 24.8, 40.1, and 20.1 and Crude B = 15,25.1,40.1, and 19.8 with crude price of 2.05$/kg and 2.07$/kg respectively? ALSO, with respective cut A = 18,24,42, and...
-
1. Executive Summary of Samsung company profile; products or services; brief on Segment of consumers, target of company, position of company. One final para on issues and recommendations 2. A brief...
-
The group C 2h consists of the elements E, C 2 , h , i. Construct the group multiplication table and find an example of a molecule that belongs to the group.
-
Name some of the various types of financial intermediaries described in the chapter and indicate the primary reason(s) each was created.
-
At the beginning of the current golf season, on April 1, 2018, the general ledger of In the Pines Golf Shop showed Cash $4,200; Inventory $19,500; Common Shares $12,000; and Retained Earnings...
-
Eagle Hardware Store Ltd. completed the following merchandising transactions in the month of May 2018. At the beginning of May, Eagle's ledger showed Cash $7,000; Accounts Receivable $1,500;...
-
The adjusted trial balance of Club Canada Wholesale Inc. contained the following accounts at December 31, the company's year end: Instructions (a) Prepare a single-step income statement. (b) Prepare...
-
Tech Innovations acquired a technology research and development center on 1 January 20X0 for $5,000,000 with an estimated residual value of $500,000 and an estimated useful life of 20 years. The...
-
Question 1 The price paid by the parent to acquire the subsidiary may exceed the book value of the subsidiary's net assets because O The subsidiary has unrecorded intangible assets O None of these...
-
on Palms equity security investments, purchased 1/1/20, total these amounts: Cost: $40,000 Fair Value @ 12/31/20: $42,000 Fair Value @ 12/31/21: $35,000 Indicate the amount to be included in 2021 Net...
Study smarter with the SolutionInn App