An increase in which one of the following will increase a firm's quick ratio without affecting its cash ratio?
A)accounts payable
B)cash
C)inventory
D)accounts receivable
E)fixed assets

Question

Quizplus · Accepted Answer

The quick ratio is calculated as (Cash + Marketable Securities + Accounts Receivable) / Current Liabilities. Increasing accounts receivable improves the quick ratio without affecting the cash ratio, which is calculated as (Cash + Marketable Securities) / Current Liabilities.

An Increase in Which One of the Following Will Increase