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August 30, 2017 at 3:27 pm #404389
natty2
Participant
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Hi mike
I don’t understand why the answer is A I would say inventory is taken from the quick ratio instead of current can you help me please

Inventory is harder to liquidate therefore it is eliminated from this ratio.

A. current ratio
B. quick ratio
August 30, 2017 at 3:34 pm #404393
MikeLittle
Keymaster
- Topics: 27
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It’s taken from the current ratio in order to arrive at the figures for use in the quick ratio

OK?
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