Answer :
The calculation of the "quick ratio" involves current assets minus inventory. Therefore, the correct option is C.
A Quick ratio is a measure of the liquidity of a company that indicates its ability to pay off its current liabilities immediately. It is also called an acid test ratio. The formula for calculating a quick ratio is:
Quick Ratio = (Current Assets - Inventory) / Current Liabilities
Where Current Assets are the assets of the company that can be converted into cash within one year and Current Liabilities are the company's debts that are due within one year
.Inventory refers to the goods or raw materials a company has on hand that it will convert into goods and sell to its customers. Therefore, the calculation of the quick ratio involves current assets minus inventory. The answer is C. Current Assets minus Inventory.
To learn more about inventory
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