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AIWMI Exam CCRA-L2 Topic 9 Question 110 Discussion

Actual exam question for AIWMI's CCRA-L2 exam
Question #: 110
Topic #: 9
[All CCRA-L2 Questions]

Ms. Mary Brown is a credit rating analyst. She had prepared a detailed report on one of her client, FlyHigh

Airlines Ltd, a company operating chartered aircrafts in Indi

a. As she was heading for a meeting with her superior on the matter, coffee spilled over her set of prepared paper(s). As she was getting late for meeting, instead of preparing entire set she could recollect few numbers from her memory and reconstructed following partial financial table:

An analyst comparing two competitors Comp Systems and Big Tables gathers the data below:

Cash Conversions Cycle:

Comp Systems: 18 days and Big Tables 32 days

Defense Interval Ratio:

Comp Systems: 50 and Big Tables: 20

What can the analyst conclude regarding the liquidity of these companies?

Show Suggested Answer Hide Answer
Suggested Answer: C

by Yoko at Apr 06, 2025, 09:12 PM

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Brianne
1 months ago
I'm leaning towards option D as well. It's always a tricky balancing act between liquidity and cash management. Looks like Comp Systems and Big Tables have found different ways to approach it.
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Ashton
1 months ago
Wait, did someone spill coffee on the financial table? That's a real bummer. I hope Ms. Mary Brown didn't have to clean up too much of a mess before the meeting.
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Elli
3 days ago
Yeah, it looks like Big Tables manages its cash better though.
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Pete
14 days ago
According to the data, it seems like Comp Systems is more liquid than Big Tables.
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Leana
24 days ago
I know, right? Spilling coffee on important documents is the worst.
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Carri
29 days ago
Oh no, that must have been stressful for Ms. Mary Brown.
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In
2 months ago
Option D seems like the correct answer to me. Comp Systems has a better cash conversion cycle, but Big Tables manages its cash better according to the defense ratio.
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Filiberto
24 days ago
That's true. It's important to consider both indicators when assessing the liquidity of a company.
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Glenna
25 days ago
Yes, it makes sense. Comp Systems may be more liquid in terms of cash conversion cycle, but Big Tables seems to have better cash management.
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Callie
29 days ago
I agree, option D seems to be the most logical conclusion.
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Gennie
2 months ago
I'm not sure, but D does sound like a logical conclusion.
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Deandrea
2 months ago
I agree with Vicki, D seems to make sense.
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Maurine
2 months ago
I'm not sure about this one. The indicators seem to give contradictory results. I might have to go with option C.
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Scarlet
24 days ago
True, but Big Tables has a better Defense Interval Ratio, showing better cash management.
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Orville
2 months ago
But Comp Systems has a lower Cash Conversion Cycle, indicating better liquidity.
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Chanel
2 months ago
I agree, the indicators do seem to contradict each other.
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Beatriz
2 months ago
I think option C is the right choice here.
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Alisha
2 months ago
The question is pretty straightforward. The cash conversion cycle and defense interval ratio clearly show that Comp Systems is more liquid than Big Tables.
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Vicki
3 months ago
I think the answer is D.
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