Company A has an accounts payable turnover of 9.5. Company B has an accounts payable turnover of 7.3. Which company is more liquid?
A)Company A is more liquid.
B)Company B is more liquid.
C)Both are equally liquid.
D)None of the above are correct.

Question

Quizplus · Accepted Answer

A higher accounts payable turnover ratio indicates that Company A is paying off its suppliers more frequently, suggesting better liquidity compared to Company B.

Company a Has an Accounts Payable Turnover of 9