From the following two statements of Assertion (A) and Reason (R), indicate the correct code: Assertion (A): A current ratio of 2 : 1 is considered satisfactory as a rule of thumb, but it should not be followed rigidly. Reason (R): The greatest weakness of the current ratio is the possibility of window dressing and manipulation.

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Economics · Accounting Ratios

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Both (A) and (R) are correct, but (R) is not the correct explanation of (A)

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Answer 1

Both (A) and (R) are correct, but (R) is not the correct explanation of (A)

Answer 2

Both (A) and (R) are wrong

Answer 3

(A) is correct, but (R) is wrong

Answer 4

Both (A) and (R) are correct, and (R) offers the correct explanation of (A)

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