Accounting 0452 · IGCSE · Interpretation of accounting ratios

Interpretation of accounting ratios — practice question

X has a current ratio of $2 : 1$. Y has a current ratio of $1.3 : 1$. What does this comparison of the ratios indicate?

  • AX has fewer liabilities than Y.
  • BX has more liquidity than Y.
  • CY has fewer current assets than X.
  • DY has more inventory than X.

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