Which of the following statements is the most reasonable conclusion from the given information below of ABC Company? Current assets: P465,000 Current liabilities: P130,000 Inventories: P270,000 Quick ratio: 1.5x Industry average: 2.1x Other businesses in the same industry have fewer inventories. The information is insufficient to make any conclusions. ABC Company cannot pay its current liabilities Below industry average quick ratio might be due to cash tied up to large amounts of inventory.

Which of the following statements is the most reasonable conclusion from the given information below of ABC Company? Current assets: P465,000 Current liabilities: P130,000 Inventories: P270,000 Quick ratio: 1.5x Industry average: 2.1x Other businesses in the same industry have fewer inventories. The information is insufficient to make any conclusions. ABC Company cannot pay its current liabilities Below industry average quick ratio might be due to cash tied up to large amounts of inventory.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.23E: Unusual income statement items Assume that the amount of each of the following items is material to...

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