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    Question

    A firm’s current ratio is 1.5:1 and quick ratio is

    1.5:1. What does it suggest about inventory?
    A High inventory Correct Answer Incorrect Answer
    B No inventory Correct Answer Incorrect Answer
    C Inventory equals liabilities Correct Answer Incorrect Answer
    D Inventory equals quick assets Correct Answer Incorrect Answer

    Solution

    If both current and quick ratios are same, it implies no inventory is held.

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