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The following information is taken from the financial statements of two companies that have applied to your bank for short-term credit. The bank will extend
The following information is taken from the financial statements of two companies that have applied to your bank for short-term credit. The bank will extend credit to one of the company only. Your responsibility is to recommend your manager whichever company you believe performs better. Company A Current Ratio Quick Ratio Inventory Turnover Days in Inventory Accounts Receivable Turnover Collection Period 3 0.90 2.50 146 8 45.63 Company B 2.50 1.40 5 73 8.50 42.94
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