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Quick ratio Adieu Company reported the following current assets and current liabilities for two recent years: Dec. 31, 20Y4 Dec. 31, 20Y3 Cash $1,000 $1,040

Quick ratio

Adieu Company reported the following current assets and current liabilities for two recent years:

Dec. 31, 20Y4 Dec. 31, 20Y3
Cash $1,000 $1,040
Temporary investments 1,200 1,500
Accounts receivable 840 910
Inventory 2,300 2,700
Accounts payable 1,900 2,300

a. Compute the quick ratio on December 31 for each year. Round to one decimal place.

20Y4 20Y3
Quick Ratio fill in the blank 1 fill in the blank 2

b. Is the quick ratio improving or declining?

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