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Q. Show the Quick ratio or acid test?
Quick ratio = Current assets less inventories/Current liabilities (times)
This ratio measures immediate solvency of a business as it removes inventories out of the equation, which is the item least representing cash, as it needs to be sold. Normal is around 1: 1 however this varies within different industries.
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The new investment has been under consideration since the beginning of January 2008 when the new government of Gujistan first invited companies to submit their proposals to build a
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If current ratio for a company is equal to its acid test (that is, quick ratio), then: A: The current ratio must be less than one. B: Working capital is negative. C: Trade
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