Acme Company is applying for a loan in which the bank requires a quick ratio...
90.2K
Verified Solution
Link Copied!
Question
Accounting
Acme Company is applying for a loan in which the bank requires a quick ratio of at least 1. Acme's quick ratio is 0.8. Explain why the bank is using this ratio over some other measure. Which of the following actions suggested by an intern to you the CFO, if any, would actually increase Acme's quick ratio? (1) purchasing inventory through the issuance of a long-term note, (2) Implementing stronger procedures to collect accounts receivable at a faster rate, (3) paying an existing account payable, or (4) selling obsolete inventory at a loss.
Acme Company is applying for a loan in which the bank requires a quick ratio of at least 1 . Acme's quick ratio is 0.8 . Explain why the bank is using this ratio over some other measure. Which of the following actions suggested by an intern to you the CFO, If any, would actually increase Acme's quick ratio? (1) purchasing inventory through the issuance of a long-term note, (2) Implementing stronger procedures to collect accounts receivable at a faster rate, (3) paying an existing account payable, or (4) selling obsolete inventory at a loss
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
