O-LevelAccountingAnalysis and interpretation7707/12 · May/June 2023 · Q341 Mark
The following ratios relate to the businesses of Ewa and Max. current ratio 2.2:1 liquid (acid test) ratio 1.4:1 Max 2.4:1 1.0:1 An accounting student made the following statements. 1 Ewa can meet her current liabilities from her current assets more easily than Max. 2 Ewa can meet her current liabilities from her liquid assets more easily than Max. 3 Max has insufficient current assets to meet his current liabilities. 4 Max has sufficient liquid assets to meet his current liabilities. Which statements are correct?
A1 and 3
B1 and 4
C2 and 3
D2 and 4
✓ Correct answer
D: 2 and 4
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