BackgroundJimmy's Sweets Company sells a lovely range of irresistible sweets to thegeneral public.Jimmy has calculated the following ratio analysis for the years ending 2020and 2019 below:20202019Current Ratio3.201.50Quick Ratio0.301.20Inventory Turnover (days)17 days22 daysAccounts Receivable Turnover (days)62 days 32 daysQuestionWhich answer below is the correct interpretation of the change in eachratio, from 2019 to 2020?Select one:O a. Current Ratio is worse, Quick Ratio is worse, InventoryTurnover is worse, Accounts Receivable Turnover is worse.O b. Current Ratio is better, Quick Ratio is better, Inventory Turnover isbetter, Accounts Receivable Turnover is better.O c. Current Ratio is better, Quick Ratio is worse, InventoryTurnover is better, Accounts Receivable Turnover is better.O d. Current Ratio is better, Quick Ratio is worse, InventoryTurnover is better, Accounts Receivable Turnover is worse.

Introduction:- Ratio analysis is used compare the line items present in the financial statements of…

O a. Current Ratio is worse, Quick Ratio is worse, Inventory Turnover is worse, Accounts Receivable Turnover is worse. O b. Current Ratio is better, Quick Ratio is better, Inventory Turnov- better, Accounts Receivable Turnover is better. O c. Current Ratio is better, Quick Ratio is worse, Inventory Turnover is better, Accounts Receivable Turnover is better. O d. Current Ratio is better, Quick Ratio is worse, Inventory Turnover is better, Accounts Receivable Turnover is worse.

O a. Current Ratio is worse, Quick Ratio is worse, Inventory Turnover is worse, Accounts Receivable Turnover is worse. O b. Current Ratio is better, Quick Ratio is better, Inventory Turnov- better, Accounts Receivable Turnover is better. O c. Current Ratio is better, Quick Ratio is worse, Inventory Turnover is better, Accounts Receivable Turnover is better. O d. Current Ratio is better, Quick Ratio is worse, Inventory Turnover is better, Accounts Receivable Turnover is worse.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 10P

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