Answer:
c. carrying excess inventories.
Explanation:
The current ratio of a company is used to measures whether the company has enough of its resources to meet the short-term obligations. It is used to compare an organization's current assets to the current liabilities of it. It is also known as liquidity ratio.
The acid test ratio compares a company's total cash and accounts receivable to the total current liabilities of the company. It is also known as quick ratio.
The current ratio of a company is increasing means the company is having more inventories in stock. This inventories can be considered as assets which is not quickly liquidated.
Hence the correct option is (c).
