Jazeera Airways
Receivables & Inventory
Liquidity Ratios
100

In which country was Jazeera Airways founded?

Kuwait

100

What type of inventory does Jazeera Airways hold?

Spare parts and supplies

100

What is the formula for working capital?

Current assets − Current liabilities

300

Do Jazeera Airways passengers usually pay before or after their flights?

Before their flights

300

Does a higher accounts receivable turnover mean faster or slower collection?

Faster collection

300

What does a negative working capital mean?

Current liabilities exceed current assets.

500

Why does Jazeera Airways receive cash early compared to many other businesses?

Because passengers usually pay for their tickets before flying.

500

Jazeera's days' sales in receivables decreased from about 15 days to 11 days. Is this an improvement or a decline?


An improvement, because Jazeera collects its receivables faster.

500

If current assets are KD 80 million and current liabilities are KD 100 million, what is the current ratio?



0.80 (80 ÷ 100)