The Current Ratio Is a Measure of the Ability of a Company

question 16

True/False

The current ratio is a measure of the ability of a company to pay its short-term liabilities out of short-term assets.

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Definitions:

Liable

Being legally responsible for something, typically a debt or a legal obligation.

Constructive Notice

Notice of agency termination that is usually given by publishing an announcement in a newspaper.

Agency Relationship

An agency relationship exists when one party, the agent, is authorized to act on behalf of another, the principal, in business transactions with third parties.

Terminated

Terminated means bringing something to an end or conclusion, often referring to the cessation of employment or the conclusion of agreements.