The following ratios were extracted from the books of Cartel limited. Liquidity ratios (Current and Quick ratios) Liquidity ratios 2002 2003 2004 Industry Average Current Ratio 2.33 1.46 2.58 2.70 Quick Ratio 0.85 0.50 0.93 1.00 i) What can you say about the company's liquidity position in 2002, 2003, and as projected for 2004? ii) How are these liquidity ratios useful to the managers of the company?
The following ratios were extracted from the books of Cartel limited. Liquidity ratios (Current and Quick ratios) Liquidity ratios 2002 2003 2004 Industry Average Current Ratio 2.33 1.46 2.58 2.70 Quick Ratio 0.85 0.50 0.93 1.00 i) What can you say about the company's liquidity position in 2002, 2003, and as projected for 2004? ii) How are these liquidity ratios useful to the managers of the company?
Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter3: Analysis Of Financial Statements
Section: Chapter Questions
Problem 4MC
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The following ratios were extracted from the books of Cartel limited.
- Liquidity ratios (Current and Quick ratios)
|
Liquidity ratios |
2002 |
2003 |
2004 |
Industry Average |
|
Current Ratio |
2.33 |
1.46 |
2.58 |
2.70 |
|
Quick Ratio |
0.85 |
0.50 |
0.93 |
1.00 |
|
i) What can you say about the company's liquidity position in 2002, 2003, and as projected for 2004? ii) How are these liquidity ratios useful to the managers of the company? |
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