Vallante Corporation.’s quick ratio is , and its current ratio is , whereas East India Inc. (EII)’s quick ratio is , and its current ratio is .
Which of the following statements are true? Check all that apply.
An increase in the quick ratio over time usually means that the company’s liquidity position is improving.
As compared to East India Inc. (EII), Vallante Corporation. has less liquidity and relatively greater reliance on outside cash flow to finance its short-term obligations.
Vallante Corporation. has a better ability to meet its short-term liabilities than East India Inc. (EII)
If a company’s current liabilities are increasing faster than its current assets, the company’s liquidity position is weakening.