Which of the Following Items Is a Measure of a Company's

question 22

Multiple Choice

Which of the following items is a measure of a company's ability to collect receivables?

• A)The inventory turnover ratio
• B)The current ratio
• C)The acid- test ratio
• D)The day's sales in receivables

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Definitions:

Income Earners

Individuals or entities that receive income through wages, salaries, investments, or other forms of financial gain.

Poverty Line

The minimum level of income deemed necessary to achieve an adequate standard of living in a given country.

Invisible Hand

A metaphor introduced by Adam Smith to describe how an individual's pursuit of self-interest in a free-market economy inadvertently benefits society as a whole.

Allocation of Resources

The process of allocating resources among competing uses or projects in order to achieve desired outcomes.