A low trade payables turnover ratio caused by an aggressive cash management strategy, while the quick ratio is adequate, would be perceived by analysts as a weakness.

Question

Quizplus · Accepted Answer

A low trade payables turnover ratio, in the context of an aggressive cash management strategy and an adequate quick ratio, indicates that the company is efficiently managing its cash by delaying payments to suppliers without jeopardizing its liquidity. This is generally seen as a strength because it shows effective cash management and the ability to maintain liquidity.

A Low Trade Payables Turnover Ratio Caused by an Aggressive