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It is important to review not just the current ratio, but also the quick ratio and cash ratio because: Multiple Choice companies can operate with
It is important to review not just the current ratio, but also the quick ratio and cash ratio because: Multiple Choice companies can operate with a cash ratio close to zero and maintain liquidity. the cash ratio must always provide a greater statistic than the current ratio and quick ratio. a low current ratio may not necessarily indicate a problem with a company. the quick ratio includes inventory that can be easily liquidated for cash. GAAP requires it
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