The Most Commonly Used Liquidity Ratio Is the Current Ratio,which

question 121

True/False

The most commonly used liquidity ratio is the current ratio,which has been called the "banker's ratio."

---

Definitions:

Gross Profit Percentage

A financial ratio showing the proportion of money left over from revenues after accounting for the cost of goods sold.

Contract Price

The total amount agreed upon in a contract for the sale of goods, services, or property.

Involuntary Conversion

The forced exchange of an asset into a different form or property, often due to theft, casualty or condemnation, with potential tax implications.

Deferred Gain

A profit from the sale of property or an investment that has been realized but not recognized for tax purposes in the current period.