Quick Ratio: Supermax Vs. Adventa Berhad

3.1 Quick Ratio
The quick ratio for Supermax Corporation Berhad and Adventa Berhad are 0.79 times and 1.4 times respectively. It shows that Adventa is able to settle its current liabilities in a very shot period compared to Supermax but alternatively investigates that it has investing too much of its resources in working capital ($Accounting-Simplified n.d.$). The lower quick ratio of Supermax indicates that it is taking a higher risk by fail to maintain its liquid resources but alternately reveals the better credit terms with its supplier than Adventa ($Accounting-Simplified n.d.$). For every RM1 of current liabilities, Supermax has only RM0.79 worth of quick asset. The higher quick ratio of Supermax is due to its current liabilities, it has
Supermax Corporation Berhad and Adventa Berhad have a debt ratio less than 50% reveals that both of them are less risky in finance, their total assets are capable to pay off their debts, liabilities and interests (MyAccountingCourse 2018). Supermax Corporation Berhad may face a higher bankruptcy financial risk due to the higher amount of debts compared to Adventa Berhad. The higher percentage in debt ratio shows that Supermax Corporation Berhad has a poor debt management in total assets that is financed by debt (Irfanullah Jan 2018). Besides, it is relative costly for Supermax Corporation Berhad to borrow additional loans and debts from the bank if the company don’t raise up its equities and assets. The investors and creditors of Supermax Corporation Berhad will be unwilling to invest and lend more money to the company when compared to Adventa Berhad due to a higher percentage of debt ratio. The debt ratio of Supermax Corporation Berhad is higher than Adventa Berhad may due to the poor management of the company in debts and liabilities, they do not put the efforts as Adventa Berhad has done in managing total assets that is financed by their debts. Therefore, Supermax Corporation Berhad should be looking for more equity and
Supermax Corporation Berhad has a higher book value per share which is RM1.59 than the RM0.53 of Adventa Berhad, the market value per share is RM1.94 and RM0.655 for Supermax Corporation Berhad and Adventa Berhad respectively as at the end of the financial year (Yahoo Finance 2018). Both of the companies have a market to book ratio with greater than 1, this indicates that their stock price are not undervalued and the money invest to the company is worthy (ROSEMARY 2018). Adventa Berhad has a slightly better M/B ratio than Supermax is due to a relatively higher market price, which means the book value invested to Adventa Berhad is worth more than Supermax. So, investors is more willing to pay for a share of Adventa Berhad than to the Supermax Corporation