Which of the Following Ratios Is a Measure of the Firm's

question 99

Multiple Choice

Which of the following ratios is a measure of the firm's ability to pay its current liabilities once inventory is subtracted from current assets?

• A) the acid-test ratio
• B) the net margin ratio
• C) the profitability ratio
• D) the inventory ratio

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Definitions:

Electrons

Subatomic particles with a negative electric charge, found in all atoms and acting as the primary carrier of electricity in solids.

Universal Solvent

Water, due to its ability to dissolve more substances than any other liquid, thus facilitating countless biological and chemical processes.

Active Site

The region of an enzyme where substrate molecules bind and undergo a chemical reaction.

Hydrogen Ions

Positively charged ions (H+) formed when hydrogen atoms lose or share their electron, significantly influencing acidity in solutions.