Question
Given the following information, which is true? Company 1 - Current Ratio: 1.1, Times Interest Earned: 5.2, Inventory Turnover: 4.0 Company 2 - Current Ratio:
Given the following information, which is true?
Company 1 - Current Ratio: 1.1, Times Interest Earned: 5.2, Inventory Turnover: 4.0
Company 2 - Current Ratio: 0.4, Times Interest Earned: 1.6, Inventory Turnover: 5.2
Company 3 - Current Ratio: 2.3, Times Interest Earned: 3.2, Inventory Turnover: 2.1
Company 1 is the least efficient at managing inventory
Company 2 is the most liquid firm
Company 2 has the highest probability of defaulting on its debt
Lenders would view Company 3 as higher risk of default than company 2
Company 2 is more liquid than Company 1
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Financial Management For Public Health And Not For Profit Organizations
Authors: Steven A. Finkler
2nd Edition
0131471988, 978-0131471986
