Solvency ratio data are primarily concerned with the ability of a company to:
A)produce profits.
B)handle its debt.
C)manage its cash flow.
D)provide income for stockholders.

Question

Quizplus · Accepted Answer

Solvency ratio data are mostly used to determine a company's capability to pay back its debts. It is calculated by comparing a company's total liabilities to its total assets, and it indicates the extent to which a company can meet its long-term obligations using its current assets.

Solvency Ratio Data Are Primarily Concerned with the Ability of a Company