Which of the following is correct?
A)The receivables turnover ratio depicts the company's frequency of cash collections.
B)The inventory turnover ratio can be used to assess the company's frequency of selling inventory.
C)The current ratio reflects the company's ability to pay current debt.
D)All of these.

Question

Quizplus · Accepted Answer

All of these statements are correct. The receivables turnover ratio measures how quickly a company collects cash from its customers, the inventory turnover ratio measures how quickly a company sells its inventory, and the current ratio assesses a company's ability to pay its current liabilities with its current assets.

Which of the Following Is Correct