Which of the Following Statements Concerning the Cash Flow Ratio

question 20

Multiple Choice

Which of the following statements concerning the cash flow ratio is true?

• A) The cash flow ratio is a better measure of liquidity than the current ratio because it is calculated using cash flow generated over a whole reporting period rather than the current assets at a point in time.
• B) The cash flow ratio is used to assess liquidity.
• C) The cash flow ratio compares the cash flow from operating activities with the current liabilities.
• D) All of the above statements are true.

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