Why is inventory excluded from the quick ratio

Assignment Help Financial Management
Reference no: EM131027224

Why is inventory excluded from the Quick Ratio? a. It is not as easily converted to cash; that is, it is not as "liquid" as other current assets. b. It is hard to value, and thus inventory amounts are often unreliable. c. It depends on the type of inventory and industry, so this makes the Quick Ratio applicable for all industries and companies. d. Inventory can often be difficult to count or measure. e. None of these

Reference no: EM131027224

Questions Cloud

The property will provide him with rental income : Genaro needs to capture a return of 40% for his one-year investment in a property. He believes that he can sell the property at the end of the year for $150,000 and that the property will provide him with rental income of $24,000. What is the maximum..
What is the standard deviation of the stock : You believe that next year there is a 20% probability of a recession and an 80% probability that the economy will be normal. If your stock will yield -11% in a recession and 22% in a normal year, what is the standard deviation of the stock?
What is his annualized return : Craig purchased 150 shares of Box, Inc. (BOX) when it went public for $14 per share. He wants to sell his shares today, 50-days later, for $18.20 and it paid a $2.13 dividend. What is his annualized return?
What is the expected return of the second stock : Cameron has a two-asset portfolio with an expected return of 13.80%. The weight of the two stocks is 30% and 70%. The first stock has an expected return of 17%, what is the expected return of the second stock?
Why is inventory excluded from the quick ratio : Why is inventory excluded from the Quick Ratio?
What is the expected return e of the portfolio : Assume you have the following three-asset portfolio with the following characteristics: What is percentage of your portfolio is invested in Stocks A, B, and C respectively? What is the expected return E(Rp) of the portfolio?
Firm did not pay a dividend as all profits were reinvested : Rick invested in Buffalo Wild Wings (BWLD) last year when the stock was $171.36. Over the year, the firm did not pay a dividend as all profits were reinvested in the company. The current share price of BWLD is $186.74. What was Rick’s capital gain yi..
Between making public offering-arranging private placement : You need to choose between making a public offering and arranging a private placement. In each case the issue involves $9.3 million face value of 10-year debt. You have the following data for each: • A public issue: The interest rate on the debt woul..
What is her compound average return : Paula decides to sell the 500 shares of Microsoft, Inc (MSFT) that she bought 7 years ago for $38.50. If the current price is $41.02, what is her compound (geometric) average return?

Reviews

Write a Review

 

Financial Management Questions & Answers

  Part of a projects initial cash outflow

Which of the following is NOT part of a project's initial cash outflow?

  Explain the accounting information for financial management

Write a 700- to 1,000-word paper identifying the specific cost accounting system an organization utilizes and how it uses the accounting information for financial management. Your paper must include the following

  Be specific regarding the type of investment or debt payment

Assume you have recently graduated with your business degree, and landed a new position at a company you had been researching during your senior year in college. You have been offered a lump-sum, sign-on bonus of $5,000. Regardless of your decision t..

  What is the net new long-term debt

Suppose Raines Umbrella Corp. paid out $59,000 in cash dividends. Is this possible? If spending on net fixed assets and net working capital was zero, and if no new stock was issued during the year, what is the net new long-term debt?

  Requried annual interest rate

Your parents will retire in 19 years. They currently have $350,000 saved, and they think they will need $800,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds?

  What is value today of stock that will pay dividend

What is the value today of a stock that will pay a dividend of $4.10 one year from now, a $4.70 dividend in year two and a dividend of $5 three years from now if its expected price in year three is $35? The stock has a required rate of return of 11%.

  Calculate the present value of growth opportunities

The market consensus is that Analog Electronic Corporation has an ROE = 11% and a beta of 1.90. It plans to maintain indefinitely its traditional plowback ratio of 1/5. This year's earnings were $2.9 per share. The annual dividend was just paid. The ..

  The exchange rate between the us dollar and the swiss franc

the exchange rate between the us dollar and the swiss franc is sf1.31 and the exchange rate betweent he dollar and the

  Why did you choose this particular model

Why did you choose this particular model? Support your decision and what other issues would you consider when selecting a bank with the intent to do business?

  Calculate the current value of pension

Peter is about to retire from a company in which he worked for 24 years. Peter participated in Defined Benefit Plan which uses Unit Credit Formula (2.4% of average of 3 highest salaries multiplied by number of years of services). The three highest sa..

  Defines the cash cycle

Which one of the following defines the cash cycle?

  Compute the issue price of the bonds

Whiteside Corporation issues $500,000 of 9% bonds, due in 10 years, with interest payable semi annually. At the time of issue, the market rate for such bonds is 10%. Compute the issue price of the bonds.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd