Accounts payable turnover for Blue Industries increased from 10 to 12 during 2018. Whichof the following statements best describes what this means?a. The company paid its accounts payable more quickly in 2018, signaling a strongerliquidity position.b. The company paid its accounts payable more slowly in 2018, signaling a weakerliquidity position.c. Inventory turned over faster in 2018, meaning sales increased.d. Not enough information is provided to form a conclusion.
Accounts payable turnover for Blue Industries increased from 10 to 12 during 2018. Whichof the following statements best describes what this means?a. The company paid its accounts payable more quickly in 2018, signaling a strongerliquidity position.b. The company paid its accounts payable more slowly in 2018, signaling a weakerliquidity position.c. Inventory turned over faster in 2018, meaning sales increased.d. Not enough information is provided to form a conclusion.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Accounts payable turnover for Blue Industries increased from 10 to 12 during 2018. Which
of the following statements best describes what this means?
a. The company paid its accounts payable more quickly in 2018, signaling a stronger
liquidity position.
b. The company paid its accounts payable more slowly in 2018, signaling a weaker
liquidity position.
c. Inventory turned over faster in 2018, meaning sales increased.
d. Not enough information is provided to form a conclusion.
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