The Financial Ratio That Indicates Whether or Not the Organization

question 1

Multiple Choice

The financial ratio that indicates whether or not the organization is capable of paying off its short-term debts without having to sell its inventory is the _____________ ratio.

• A) quick
• B) current
• C) days sales outstanding
• D) inventory turnover
• E) profit

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Definitions:

Chalk

Chalk is a soft, white, porous sedimentary carbonate rock, often used for writing on blackboards or in industries like construction and art.

Period

In finance, it refers to the specific duration of time during which certain transactions or processes are evaluated or financial statements are prepared.

Overhead

The ongoing business expenses not directly attributed to creating a product or service, including rent, utilities, and administrative costs.

Labour Hours

The total number of hours worked by employees within a specific period, often used as a measure of labor productivity.