You are a financial analyst for a pharmaceutical company and the CFO has asked you to look into the following situation. Over the past year, the company has realized an increase in its current ratio and a drop in its total assets turnover ratio. Sales have remained constant as have the quick ratio and the fixed assets turnover ratio. What could possibly explain this situation? Elaborate!© BrainMass Inc. brainmass.com March 21, 2019, 10:58 pm ad1c9bdddf
An increase in the company's current ratio with a constant quick ratio shows that the company has increased the amount of inventory ...
This solution explains the situation provided regarding increased current ratio and drop in total assets turnover ratio.