An analysis of the financial statements of a business reveals the following financial ratios:
Posted: Mon Mar 07, 2022 8:29 am
1. A higher than average inventory holding period
2. A higher than average payment period for trade payables
3. A lower than average current ratio
4. A lower than average sales to working capital ratio
Which TWO of the above is consistent with a business being over-capitalized?
A. 1 and 2
B. 1 and 4
C. 2 and 3
D. 3 and 4
2. A higher than average payment period for trade payables
3. A lower than average current ratio
4. A lower than average sales to working capital ratio
Which TWO of the above is consistent with a business being over-capitalized?
A. 1 and 2
B. 1 and 4
C. 2 and 3
D. 3 and 4