Question

1. The quick ratio, measured by current assets less inventories divided by current liabilities, is also referred to as an "acid test" ratio and provides a measure of a company's ability to meet current obligations.

a. True                     b. False

2. Shorter-term cash budgets, in general, are used for actual cash control while longer-term budgets are used primarily for planning purposes.

a. True                     b. False

3. A just-in-time system of inventory control requires that manufacturers coordinate production with suppliers so that raw materials or components arrive just as they are needed in the production process. The main objective of such a system is to reduce carrying costs.

a. True                     b. False