Accounting for IGCSE & O level - Advanced Principles (Section 6 - No. 31)
If a company has a quick ratio of 0.8, what does that indicate?
The company is managing its inventory efficiently.
The company may have difficulty paying its short-term debts.
The company has a high level of profitability.
The company has a high return on capital employed (ROCE).
Paliwanag
A quick ratio below 1.0 suggests potential liquidity problems.