_____ Measure the Ability of an Organization to Convert Assets

question 119

Multiple Choice

_____ measure the ability of an organization to convert assets into the cash it needs to pay off liabilities that come due in the following year.

• A) Profitability ratios
• B) Activity ratios
• C) Liquidity ratios
• D) Leverage ratios

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Definitions:

Multiply

The arithmetic process of calculating the result of adding a number to itself a certain number of times.

Simplify

To simplify means to reduce an expression or equation to its simplest form, by combining like terms, reducing fractions, etc.

Combine

The process of uniting two or more expressions into a single expression using mathematical operations.

Simplify

The process of making an expression easier to understand or work with by combining like terms, reducing fractions, etc.