Question

A company's Quick Ratio will normally _______________.

Group of answer choices

be less than its Current Ratio

be equal to its Current Ratio

be more than its Current Ratio

depend on the Company's Balance Sheet

Answer 1

Both the current ratio and quick ratio measure a company's short-term liquidity, or its ability to generate enough cash to pay off all debts should they become due at once. Although they're both measures of a company's financial health, they're slightly different. The quick ratio is considered more conservative than the current ratio because its calculation factors in fewer items

From above equation we can say that QUICK RATIO OF COMPANY NORMALLY Be less then CURRENT RATIO

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