Which of the following measures would assist in assessing the liquidity of a company?
A)Return on equity
B)Fixed asset turnover ratio
C)Receivables turnover ratio
D)Times interest earned

Question

Quizplus · Accepted Answer

Liquidity ratios measure the company's ability to use current assets to pay its current obligations as they become due.The receivables turnover ratio is a liquidity ratio.Return on equity and fixed asset turnover are profitability ratios.Times interest earned is a solvency ratio.

Which of the Following Measures Would Assist in Assessing the Liquidity