Question

If Nike's current ratio is 1.6 and the Pittsburg Pirates current ratio is 0.9, we know from time series analysis that?

Answer 1

TIME SERIES ANALYSIS OF CURRENT RATIO MEANS, A CURRENT RATIO IS CALCULATION THROUGH WICH WE CAN GET THAT HOW MANY TIMES WE CAN COVER OUR CURRENT LIABILITY, FORMULA FOR CURRENT RATIO IA CURRENT ASSETS/CURRENT LIABILITIES, HERE NIKE'S CURRENT RATIO IS 1.6 AND PITTSBURG PIRATES CURRENT RATIO IS 0.9 WHICH MEANS FOR EVERY $1 OF CURRENT LIABILITY NIKE HAS $1.6 OF CURRENT ASSETS AND FOR EVERY $1 OF CURRENT LIABILITY PITTSBURG PIRATES HAS 0.9$ OF ASSETS.

HENCE, THROUGH TIME SERIES ANALYSIS WE CAN CONCLUDE THAT NIKE'S CURRENT ASSETS CAN COVER 1.6 TIMES OF NIKE'S CURRENT LIABILITY AND PITTSBURG PIRATES CURRENT ASSETS CAN COVER 0.9 TIMES OF NIKE'S CURRENT LIABILITY. HERE, NIKE HAVE EDGE OVER PITTSBURG PIRATES.

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