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What do they forecast?

The current ratio and quick ratio are used to forecast for the same potential future event.

Asked by Wyatt Williams, Last updated: May 29, 2022

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2 Answers

M. Parker

M. Parker

M. Parker
M. Parker, Internet Researcher, Houston

Answered Feb 21, 2019

There are some future events that will be hard to predict but in this case, the current ratio and the quick ratio have to know the possibility of financial difficulty in the future.

The current ratio is in charge of measuring if the company has the right resources in order to meet its goals in the short-term. The quick ratio will usually measure just a few items as compared to the current ratio.

It can provide an overview of what the company may expect in the next few days, weeks, or months. If the ratio shows that the company is not exactly stable, there may be some changes that might be made by the company for that.

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John Smith

John Smith

John Smith
John Smith

Answered Feb 21, 2017

The possibility of financial difficulty in the future.
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