
Current ratio is a
Quick ratio:
Quick ratio is a liquidity ratio, which displays how current liabilities are paid by the current assets excluding prepaid expenses and inventories. It ratio is used to measure the company’s immediate short term liquidity. Quick ratio can be calculated by using the following formula:
To identify: The correct answer by finding the effect of write-off of obsolete inventory on current ratio and quick ratio

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Chapter 3 Solutions
INTERMEDIATE ACCOUNTING
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