During a period of changing inventory prices, which of the following is not immediately sensitive to the particular cost flow assumption adopted?

Question

Quizplus · Accepted Answer

Quick ratio is not immediately sensitive to the particular cost flow assumption adopted because it only considers current assets that can be quickly converted to cash, such as cash, marketable securities, and accounts receivable, all of which are not affected by changes in inventory prices. Net income, current ratio, and gross profit are all directly affected by the cost flow assumption adopted because they are calculated based on the value of the inventory.

During a Period of Changing Inventory Prices, Which of the Following