Their quick ratio Is lower than Its current ratios which their current assets are decidedly reliant on inventory. Therefore they may not be able to pay Its current liabilities when needed and on time without liquidating Its Inventories which then may lead to Insolvency. Furthermore due to too much stockholders their turnover account receivable for 2012 and 2013 effects to poor cash management but still their long term assets are purchasing Its short term Ratios By a_attitude more difficulties paying its current obligations on time in 2013 than 2012.
The quick ratios equation shows that Dutch Lady has more overstocking problem in 2013 than 2012. Although their cycle is above 1, in this case as it increases from 1. 01 times to 1. 37 times, the company is still not in a good condition. Their quick ratio is lower than its current ratios which their current assets are decidedly reliant on inventory.
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