Which of the Following Statements Is True of Current Ratio

question 18

Multiple Choice

Which of the following statements is true of current ratio?

• A) It evaluates the retailer's ability to pay its short-term debt obligations.
• B) It evaluates the optimal profitability of the retailer.
• C) It evaluates the optimal productivity of the retailer.
• D) It evaluates the cost incurred by human resources against organizational profitability.
• E) It evaluates the retailer's ability to pay its long-term debt obligations.

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Definitions:

Hybrid Business Form

A type of organizational structure that blends elements of different traditional business forms, aiming for a mix of flexibility, liability protection, and tax benefits.

Sole Proprietorship

A business owned and operated by a single individual, where there is no legal distinction between the owner and the business entity.

Business Plan

A detailed document that outlines an organization's objectives, strategies, target market, financial forecasts, and operational plans.

Future Business Operations

Projected or planned activities and procedures for running a business in the future.