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When the trend of the current ratio (current assets divided by current liabilities) is increasing, it suggests that the firm's overall liquidity position is improving. On the other hand, when the trend of the acid-test ratio (quick assets divided by current liabilities) is decreasing, it indicates a decline in the firm's ability to meet its short-term obligations without relying on inventory. If the firm is depleting its inventories (option a), it would likely result in a decrease in both the current ratio and the acid-test ratio. Option b, having trouble collecting receivables, would mainly impact the accounts receivable turnover ratio but not necessarily the acid-test ratio. Option c, purchasing too much treasury stock, would not directly impact the liquidity ratios. Therefore, option d, carrying excess inventories, is the most appropriate warning indicated by the given trends. It suggests that the firm may have an inefficient inventory management system or that demand for its products has decreased.
For the study purpose, the mean of the observations is 148 gm and standard deviation is 17.4 gm. Approximately, the coefficient of variation equals to:
Following two statements are related to regression coefficient
(I) Independent of the change of origin
(II) Independent of the change of scale
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For the recorded observation, the coefficient of variation is 0.2 and the variance is 16. The arithmetic mean is:
If the random sample of size n is drawn without replacement from a finite population of size N, the correction factor for standard error of sample mean...
Two data set of size 9 and 6 have standard deviation 3 and 4 respectively and arithmetic means 3 and 3 respectively. The standard deviation of combined...
The arithmetic mean of the following frequency distribution of number of accidents X on week working days is:
X:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â...
The grouped data for the observation are as follows.
Class :Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 2-4Â Â Â Â Â Â Â Â 4-6Â Â Â Â Â Â Â Â Â 6-8...
Five persons A, B, C, D and E occupy seats in a row at random. The probability that A and B sit next to each other is: