If a firm has an quick ratio of 1,the subsequent payment of an account payable will cause the ratio to increase.

Name: If a firm has an quick ratio of 1,the subsequent payment of an account payable will cause the ratio to increase.
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Question

Quizplus · Accepted Answer

If a firm has a quick ratio of 1, it means that its current assets are equal to its current liabilities. If the firm subsequently pays an account payable, its current assets will decrease and its quick ratio will decrease. Therefore, the statement in the question is false.

If a Firm Has an Quick Ratio of 1,the Subsequent