Which of the following statements is true?
A)The inventory turnover ratio is an important solvency test for retail companies.
B)Liquidity focuses on the ability of a company to pay their long- and short-term debts.
C)Tests of profitability focus on measuring the adequacy of profit.
D)The debt to equity ratio is a measure of liquidity.

Question

Quizplus · Accepted Answer

Tests of profitability focus on measuring the adequacy of profit, assessing how well a company generates earnings relative to its expenses and other costs.

Which of the Following Statements Is True