Instructions: Explain/Define the Following Terms

question 8

Short Answer

Instructions: Explain/Define the following terms.
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Definitions:

Acid-test Ratio

A financial metric that measures a company's ability to pay off its short-term liabilities with its quick assets, excluding inventory.

Return On Total Assets

A financial ratio that measures a company's efficiency in using its assets to generate profit, calculated by dividing net income by total assets.