The Ratios That Are Used to Determine a Company's Short-Term

question 83

Multiple Choice

The ratios that are used to determine a company's short-term debt paying ability are

• A) asset turnover, interest coverage, current ratio, and receivables turnover.
• B) interest coverage, inventory turnover, current ratio, and receivables turnover.
• C) interest coverage, current ratio, and inventory turnover.
• D) current ratio, receivables turnover, and inventory turnover.

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Definitions:

Investing Activity

Transactions involving the purchase and sale of long-term assets and other investments, not directly related to the entity's primary business operations.

Land

Land is a tangible asset representing a piece of earth's surface which is owned and has a specific value attached to it, often used for commercial or residential purposes.

Income Tax Expense

The total amount of income tax that a company calculates it owes for a specific period.

Provincial Income Tax

The tax levied by a provincial government on the income of individuals and organizations within its jurisdiction, varying from province to province.