a)
Quick ratio: Quick ratio, also called as acid-test ratio, denotes that this ratio is a more rigorous test of solvency than the
Quick Assets: Quick assetsare those assets that are most liquid. The examples of quick assets include cash and bank balances, temporary investments, and accounts receivable.
Current liabilities: Current liability is a kind of liability or the obligation of the business towards the creditors, in which the business is required to pay the creditors, within a period of one year or one operating cycle of the business, whichever is longer. The examples of current liabilities include Accounts payable, Salaries and Wages payable, Interest payable, Income Tax payable.
Quick ratio for Incorporation A and Incorporation D.
b)
To interpret: Quick ratio between Incorporation A and Incorporation D.
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Financial & Managerial Accounting
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