Business, 29.02.2020 00:58 anyone5382

Liquidity ratios are used to measure a firm's ability to meet its obligations as they come due. Two of the most commonly used liquidity ratios are the: (1) Current ratio and (2) Quick, or acid test, ratio. The current ratio is the most commonly used measure of solvency. Its equation is:.
If a firm is having financial difficulty, it typically begins to pay its accounts payable more slowly and to borrow from the bank—both of which will increase its current causing a decline in the current ratio. The quick ratio is a measure of a firm's ability to pay off obligations without relying on the sale of, which are typically the least liquid of a firm's current assets. Its equation is:.

Answers: 2

Show answers

Another question on Business

Business, 21.06.2019 14:50

Baker industries’s net income is $24,000, its interest expense is $5,000, and its tax rate is 40%. its notes payable equals $27,000, long-term debt equals $75,000, and common equity equals $250,000. the firm finances with only debt and common equity, so it has no preferred stock. what are the firm’s roe and roic?

Answers: 2

Answer

Business, 23.06.2019 01:30

Bruce matthews played football for the tennessee titans. as part of his contract, he agreed to submit any dispute to arbitra- tion. he also agreed that tennessee law would determine all matters related to workers' compensation. after matthews retired, he filed a workers' compensation claim in california. the arbitrator ruled that matthews could pursue his claim in california but only under tennessee law. should this award be set aside?

Answers: 2

Answer

Business, 23.06.2019 11:00

Comparative financial statements for weller corporation, a merchandising company, for the year ending december 31 appear below. the company did not issue any new common stock during the year. a total of 800,000 shares of common stock were outstanding. the interest rate on the bonds, which were sold at their face value, was 12%. the income tax rate was 40% and the dividend per share of common stock was $0.40 this year. the market value of the company's common stock at the end of the year was $18. all of the company's sales are on account. time interest earned ratio

Answers: 3

Answer

Business, 23.06.2019 12:20

During the economic periods of , the economy is at its highest point and unemployment is low, in addition, total income is high and consumers are willing to buy products and services.

Answers: 1

Answer

You know the right answer?

Liquidity ratios are used to measure a firm's ability to meet its obligations as they come due. Two...

Questions